ECONOMICS
DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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complementary goods
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substitute goods
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overpriced
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economic bads
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shifting to the right
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Detailed explanation-1: -Complementary goods are goods used in conjunction with one another. Tennis rackets and tennis balls, eggs and bacon, and stationery and postage stamps are complementary goods. Substitute goods are goods used instead of one another. iPODs, for example, are likely to be substitutes for CD players.
Detailed explanation-2: -Answer and Explanation: The resources will be shifted from the production of bacon to the production of eggs. In this case, when the price of bacon declines, the demand for eggs will increase. The increase in demand for eggs will, in turn, cause a rise in the price.
Detailed explanation-3: -The cross-elasticity coefficient for eggs and bacon is 1.5 . The cross-elasticity coefficient for eggs and cereal is 1.8 .
Detailed explanation-4: -This means that as price decreases, the quantity demanded increases. Any change or movement to quantity demanded is involved as a movement of the point along the demand curve and not a shift in the demand curve itself.