As the price of soft drinks rise, there isin the demand for juice, which is afor soft drinks.O A. an increase; complementB. a decrease; complementC. a decrease; substituteD. no change; substituteE. an increase; subtitute

Given: There are two goods Soft Drinks and Juice. Price of soft drinks increases.

Answered: As the price of soft drinks rise, there…

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter3: Demand And Supply

Section: Chapter Questions

Problem 39CTQ: Consider the demand for hamburgers. If the price of a substitute good (for example, hot dogs)...

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Similar questions

Explain all the reasons why a decrease in a products price would lead to an increase in purchases.
What does a downward-sloping demand curve mean about how buyers in a market will react to a higher price?
As a general rule, is it safe to assume that a change in the price of a good will always have its most significant impact on the quantity demanded of that good, rather than on the quantity demanded of miller goods? Explain.
Consider the demand for hamburgers. If the price of a substitute good (for example, hot dogs) increases and the price of a complement good (for example, hamburger buns) increases, can you tell for sure what will happen to the demand for hamburger? Why or why not? Illustrate your answer with a graph.
What is the relationship between price elasticity and position on the demand curve? For example, as you move up the demand curve to higher prices and lower quantities, what happens lo the measured elasticity? How would you explain that?
Would you expect supply to play a more significant role in determining the price of a basic necessity like food or a luxury like perfume? Explain. Hint: Think about how the price elasticity of demand will differ between necessities and luxuries.
Income Effects depend on the income elasticity of demand for each good limit you buy. If one of the goods you buy has a negative income elasticity, that is, it is an inferior good, what must be true of the income elasticity of the other good you buy?
Economists define normal goods as having a positive income elasticity. We can divide normal goods into two types: Those whose income elasticity is less than one and those whose income elasticity is greater than one. Think about products that would fall into each category. Can you come up with a name for each category?
If a 10% decrease in the price of one product thatyou buy causes an 8% increase in quantity demandedof that product, will another 10% decrease in the pricecause another 8% increase (no more and no less) inquantity demanded?
Q 3 A pharmacies raise the price of insulin by 10% -does total expenditure on insulin rise or fall? B As a result of a fare ware, the price of luxury cruise falls 20% -does luxury cruise compnaies total revenue rise or fall?
Illustrate the appropriate change and specify whethereach change represents an increase or a decrease.c. When the price of chicken unexpectedly rises, many consumers choose topurchase corned beef instead.
Q5. Change on demand curve depends on a number of factors, Explain those factors by giving example and then illustrate that by graph.

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As the price of soft drinks rise, there is in the demand for juice, which is : for soft drinks. O A. an increase; complement O B. a decrease; complement C. a decrease; substitute D. no change; substitute E. an increase; subitute