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STatiana [176]
3 years ago
10

What is the substitution effect? A. All goods have a substitute, and the rise in price for substitutes causes a rise in supply f

or goods. B. When the price of one good falls, the demand for complements for that good rises, and vice versa. C. When the price of one good rises, the demand for substitutes for that good rises, and vice versa. D. All goods have a complement, and the rise in price for substitutes causes a fall in supply for goods.
Business
2 answers:
dmitriy555 [2]3 years ago
8 0

Answer:

C. When the price of one good rises, the demand for substitutes for that good rises, and vice versa.

Explanation:

substitution effect is the term given to the situation where when the price of one good rises, the demand for substitutes for that good rises, and vice versa.

The substitution effect can be defined as the decrease in demand for a product that can be attributed to consumers switching to cheaper alternatives when its price rises.

In summary, demand for a product's substitute rises when its price rises and its demand falls

There are several reasons why a product may lose market share but the substitution effect is purely a reflection of frugality. If a brand raises its price, consumers will generally switch to a cheaper alternative. If beef prices rise, many consumers will start eating more chicken instead.

bekas [8.4K]3 years ago
4 0

Answer:

C. is correct

Explanation:

When the price of one good rises, the demand for substitutes for that good rises, and vice versa

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6 0
1 year ago
You got a new job as a wedding-floral consultant. Your first client tells you that the overall theme of her wedding is romantic,
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source the Penn foster book


6 0
3 years ago
Terrell Foods reported $ 660,000 in net income​ and its weighted - average shares outstanding for the year is 100,000 shares. In
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Answer:

Basic EPS = $6.6

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Explanation:

The computation of basic and diluted​ EPS is shown below:-

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3 years ago
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