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 229 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?

Approximately one in four people diagnosed with diabetes will develop foot problems. Of these, about one-third will require lower extremity amputation.

Did you know?

After 5 years of being diagnosed with rheumatoid arthritis, one every three patients will no longer be able to work.

Did you know?

Illicit drug use costs the United States approximately $181 billion every year.

Did you know?

According to animal studies, the typical American diet is damaging to the liver and may result in allergies, low energy, digestive problems, and a lack of ability to detoxify harmful substances.

Did you know?

No drugs are available to relieve parathyroid disease. Parathyroid disease is caused by a parathyroid tumor, and it needs to be removed by surgery.

Analogy for How Magnetic Field Strengths Increase Analogy for How Magnetic Field Strengths Increase
Phrases that Decrease Customer Service Level Phrases that Decrease Customer Service Level
To increase pressure using body weight, lean on your client. To increase pressure using body weight, lean on your client.
How to use the product rule to find the derivative of a function How to use the product rule to find the derivative of a function
GloFish, marketed as the world’s first GM pet, are a controversial product of genetic engineering GloFish, marketed as the world’s first GM pet, are a controversial product of genetic engineering
Suppose the market supply curve is p = 5Q. If price increases from 10 to 15, the change in ... Suppose the market supply curve is p = 5Q. If price increases from 10 to 15, the change in ...
Video: Net filtration pressure and lymph formation, edema & blood velocity

For a complete list of videos, visit our video library