This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: An increase in the price of Product X leads to a decrease in demand for Product Y. The price ... (Read 228 times)

KimWrice

  • Hero Member
  • *****
  • Posts: 579
on: Jun 30, 2018
An increase in the price of Product X leads to a decrease in demand for Product Y. The price increase also increases the demand for Product Z, a related good. Discuss the relationship between these products.

Question 2

Will MPC plus MPS always equal one? Explain why or why not.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

popopong

  • Sr. Member
  • ****
  • Posts: 307
Reply #1 on: Jun 30, 2018
Answer to Question 1

Product X and Product Y: complements.
Product X and Product Z: substitutes.

Answer to Question 2

Yes, MPC plus MPS will always equal one. The reason is that there are only two things that an individual can do with income spend it or save it. As such, for each dollar of additional income, a certain percentage will be used for consumption and the remaining percentage will be devoted to saving.


KimWrice

  • Hero Member
  • *****
  • Posts: 579
Reply #2 on: Jun 30, 2018
Thank you :)


popopong

  • Sr. Member
  • ****
  • Posts: 307
Reply #3 on: Jun 30, 2018
Happy to help you


« previous next »
 

Did you know?

Blood is approximately twice as thick as water because of the cells and other components found in it.

Did you know?

Oliver Wendell Holmes is credited with introducing the words "anesthesia" and "anesthetic" into the English language in 1846.

Did you know?

Serum cholesterol testing in adults is recommended every 1 to 5 years. People with diabetes and a family history of high cholesterol should be tested even more frequently.

Did you know?

Cucumber slices relieve headaches by tightening blood vessels, reducing blood flow to the area, and relieving pressure.

Did you know?

Fungal nail infections account for up to 30% of all skin infections. They affect 5% of the general population—mostly people over the age of 70.

Many ideologies stem from older theories. The ideas of the philosophers are simplified. Ideologies Many ideologies stem from older theories. The ideas of the philosophers are simplified. Ideologies
A typical camshaft-driven high-pressure pump used to increase fuel pressure to 2,000 PSI or higher. A typical camshaft-driven high-pressure pump used to increase fuel pressure to 2,000 PSI or higher.
IPCC Temperature Increase Predictions Relative to 1986-2005 IPCC Temperature Increase Predictions Relative to 1986-2005
Marginal Supply - Demand Curve Marginal Supply - Demand Curve
The demand for energy is met by burning coal and other fossil fuels The demand for energy is met by burning coal and other fossil fuels
Decrease in mean haplotype heterozygosity Decrease in mean haplotype heterozygosity
Video: Green alga life cycle Animation

For a complete list of videos, visit our video library