Refer to Figure 2-1. ________ is (are) inefficient in that not ...

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Refer to Figure 2-1. ________ is (are) inefficient in that not all resources are being used.
 
  A) Point A B) Point B C) Point C D) Points A and C

Question 2

Explain how the following factors will shift the demand curve for Gillette shaving cream.
 
  a. The price of a competitor's shaving cream increases.
  b. With an increase in unemployment, the average level of income in the economy falls.
  c. Shaving gels and foams, marketed as being better than shaving creams, are introduced in the market.

[sultana.d]

Answer to Question 1

A

Answer to Question 2

a. Since Gillette and other shaving creams are substitutes, an increase in the price of a competitor's shaving cream should lead to an increase in the demand for Gillette shaving cream. This means that the demand curve for Gillette shaving cream will shift to the right.
b. With a fall in the average income level, the demand for shaving cream is likely to fall. The demand curve for Gillette shaving cream will shift to the left.
c. Shaving gels and foams would be considered substitutes for shaving cream. The demand curve for Gillette shaving cream will shift to the left.

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Thank you

[sultana.d]

Happy to help you