ECONOMICS
SUPPLY
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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A
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B
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C
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D
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Detailed explanation-1: -Question: If the demand for coffee decreases as income decreases, coffee is a(n): a. normal good.
Detailed explanation-2: -Tea and coffee are such type of goods. So if price of coffee increases, quantity demanded for coffee will decrease. So the consumers using coffee will now shift themselves to tea unless the price decreases for coffee. So demand for tea is expected to increase now.
Detailed explanation-3: -Doughnuts and coffee are complements; tea and coffee are substitutes. Complementary goods are goods used in conjunction with one another.
Detailed explanation-4: -Tea is a substitute for coffee. This means a decrease in the price of tea makes coffee relatively less attractive. This will decrease the demand for coffee which is visualized as a leftward shift in the demand curve. This will cause the equilibrium quantity and price of coffee to fall.
Detailed explanation-5: -here, for the answer answer is an increase in the price of coffee. The correct option is that increased in price of coffee.