Economics (MindTap Course List)
13th Edition
ISBN: 9781337617383
Author: Roger A. Arnold
Publisher: Cengage Learning
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Chapter 4.3, Problem 2ST
To determine
The validity of the given statement.
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Economics (MindTap Course List)
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- Assuming that fish and chips are complementary products, if the price of fish rises, then the demand for chips will:arrow_forwardYou're shopping online, and you place an item in your virtual cart. Two days later, you return to the virtual cart to check out and find that the item is now more expensive. Assuming that the market is competitive, what could explain the price increase?arrow_forwardRecall that Casper's utility function is 3x + y, where x is his consumption of cocoa and y is his consumption of cheese. If the total cost of x units of cocoa is x2, the price of cheese is $8, and Casper's income is $184, how many units of cocoa will he consume?arrow_forward
- Because of the housing bubble, many houses are now selling for much less than their selling price just two to three years ago. There is evidence that homeowners with virtually identical houses tend to ask for more if they paid more for the house. What fallacy are they making?arrow_forwardMike has two identical brothers. Each of them have the same utility function below. If Mike and his brothers are the only people in the market, what is the aggregate demand at each price of X below? (Each of their income is $100 and the price of Y is always $1). U (x,y) = x^2/5 Y^3/5 Price of X=$8 Price of X=$4 Price of X=$2 Price of X=$1arrow_forwardWhat is one consumer food or service for which in the last 10 to 15 years consumers preference has actually increased, and still, the price has decreased. Based on all the supply and demand determinants, what is a possible reason that could cause the decrease in the price of the suggested good.arrow_forward
- The utility function of a certain good is given by U(x) = 60x - x2 where x represents the number of units produced and sold during a month.How many units must be produced and sold to maximize utility? What is the maximum utility?arrow_forwardIf the price of a good or service is lowered and people buy more of this good or service, this finding is associated with principle # _____?arrow_forwardIs the following claim logical? Explain your answer.Actor Matt Damon will be more likely to buy a court-side Boston Celtics basketball seat because they are more expensive.arrow_forward
- Do the equations state that good A is a substitute for good B? Yes or no. Defend your answer.arrow_forwardWhen the price of chicken unexpectedly rises, many consumers choose to purchase corned beef instead.arrow_forwardSuppose one of your friends offered the following argument: a rightward shift in demand will cause an increase in price. The increase in price will cause a rightward shift of the supply curve, which will lead to an offsetting decrease in price. Therefore, it is impossible to tell what effect an increase in demand will have on price. Do you agree with your friend? If not, what is the flaw in your friend’s reasoning?arrow_forward
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