If the price of a complementary good increases, then demand would increase or decrease?
complementary good or complement is a good with a negative cross elasticity of demand, in contrast to a substitute good.This means a good's demand is increased when the price of another good is decreased. Conversely, the demand for a good is decreased when the price of another good is increased.If goods A and B are complements, an increase in the price of A will result in a leftward movement along the demand curve of A and cause the demand curve for B to shift in; less of each good will be demanded. A decrease in price of A will result in a rightward movement along the demand curve of A and cause the demand curve of B to shift outward ; more of each good will be demanded. Example for complementary goods are: bread and butter, tea and sugar etc.DONT FORGET TO UPVOTE IF YOU REALLY LIKED THE ANSWER!!
It has been noted that when the price of a good increases people purchase less of the good. This is an example?
11. If the production possibilities curve is a downward-sloping straight line, then A) resources are highly specialized, making it difficult to use them for alternative uses. B) technological change has increased. C) production is efficient only when producing at the mid-point. D) all resources must be perfectly adaptable for alternative uses. 12. The only way that a society can produce at a point outside the production possibilities curve is A) through economic growth. B) by producing efficiently. C) by obeying the Law of Increasing Relative Cost. D) to use the concept of opportunity cost. 13. The concept of absolute advantage relies upon A) the idea of comparative advantage. B) the concept of efficiency as measured by labor productivity. C) the idea of opportunity cost. D) the concept of economic efficiency as measured on the production possibility curve. 14. Macroeconomics often relies on microeconomic analysis because A) microeconomics is older than macroeconomics. B)
Which of the following increases the supply of gasoline?
C) a decrease in the price of a resource used to produce gasoline, such as crude oil The question asks about an increase in supply; this is referring to a situation where the supply curve will shift rightward. A change in input costs is one of the factors of supply which will cause the supply curve to shift. The other answer choices are all false. A is a situation of dis-equilibrium along the same supply/demand curves; B will represent a movement along the same supply curve; D and E will shift demand, which also will represent a movement along the same supply curve. These other choices will all change the quantity supplied, but not the supply curve itself.
What do you think will happen to the price and quantity of DVD players if personal income increases?
What do you think will happen to the price and quantity of DVD players if a. The availability of good movies to play on DVD player increases? b. Personal income increases? c. The price of inputs to produce DVD players decrease? d. Ticket prices at local movie theaters decline substantially?
When the price of a substitute rises, what happens to the supply and equilibrium of price and quantity?
Suppose tea and coffee are substitutes — meaning you could choose either of the two as a mid-morning beverage. If the price of tea goes up, some consumers would choose to drink coffee. The quantity of tea demanded would fall with the rise in price of tea, which is what you’d expect. Because there will be an increase in the quantity of coffee demanded, you can expect the price of coffee to go up.Technically, you would say that for tea, the movement will be upward along the demand curve, and in the case of coffee, the demand curve will shift outward (toward the right) so that the equilibrium price of coffee will go up and the quantity demanded will also go up. The former is a movement along the tea demand curve, and the latter a rightward shift of the demand curve for coffee. In the first case, the rise in the price of tea leads to the reduction in demand for tea, and in the second case, the increase in demand for coffee (the substitute) leads to the increase in coffee price.
What happens to the average true cost of all goods when the price of one good goes to infinity?
When the price gos infinity the quantity purchased will go to zero so the market will behave as if the good did not exist. The productive resources that were used producing it will be diverted to production of other goods and the consumption of that good will be shifted to other goods. Therefore a new market equilibrium prices will be establish . Only if you assume that the net income and supply of other goods would not be effected can you claim unambiguously that the the average prices of other goods would increase.