Author Question: Jennifer learns that the price of CDs will be going up 10 percent next week. She usually buys three ... (Read 86 times)

robinn137 · **on:** Jul 1, 2018

Jennifer learns that the price of CDs will be going up 10 percent next week. She usually buys three CDs per week. What happens to Jennifer's demand for CDs this week?
a. It does not change because only quantity demanded changes when price changes.
b. It increases because the price will be lower next week.
c. It decreases because the price will be higher next week.
d. It increases because the price will be higher next week.
e. It decreases because the price will be lower next week.

Question 2

Assume that black beans and rice are staples in the diet of one particular family. How could you tell if these goods were complements, substitutes, or unrelated goods?
a. If the price of black beans rose and the consumption of rice remained the same, they would be substitutes.
b. If the price of black beans rose and the consumption of rice increased, they would be substitutes.
c. If the price of black beans rose and the consumption of rice decreased, they would be substitutes.
d. If the price of black beans rose and the consumption of both goods remained the same, they would be complements.
e. There is no way to determine whether these goods are complements, substitutes, or unrelated goods.