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 259 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?

The top five reasons that children stay home from school are as follows: colds, stomach flu (gastroenteritis), ear infection (otitis media), pink eye (conjunctivitis), and sore throat.

Did you know?

Lower drug doses for elderly patients should be used first, with titrations of the dose as tolerated to prevent unwanted drug-related pharmacodynamic effects.

Did you know?

Sildenafil (Viagra®) has two actions that may be of consequence in patients with heart disease. It can lower the blood pressure, and it can interact with nitrates. It should never be used in patients who are taking nitrates.

Did you know?

Recent studies have shown that the number of medication errors increases in relation to the number of orders that are verified per pharmacist, per work shift.

Did you know?

A strange skin disease referred to as Morgellons has occurred in the southern United States and in California. Symptoms include slowly healing sores, joint pain, persistent fatigue, and a sensation of things crawling through the skin. Another symptom is strange-looking, threadlike extrusions coming out of the skin.

Rhytidoplasty. This is a common form of plastic surgery in which the skin is pulled and sutured to d Rhytidoplasty. This is a common form of plastic surgery in which the skin is pulled and sutured to d
Results from sequential study of two cohorts tested at three ages and at three different points in t Results from sequential study of two cohorts tested at three ages and at three different points in t
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
Aspartate leads via homoserine to threonine, lysine, and methionine Aspartate leads via homoserine to threonine, lysine, and methionine
Use the product rule to find derivative Use the product rule to find derivative
Find derivative using product rule Find derivative using product rule
Video: Green alga life cycle Animation

For a complete list of videos, visit our video library