Mary increases her consumption of Good X after the price Good Y decreased. For Mary...
a.) Good X is an inferior
b.) Good Y is an inferior good
c.) Good X and Good Y are complements
d.) Good X and Good Y substitues
3 answers
c.) Good X and Good Y are complements
Iexp;ain. I thinki there is a mistake.
Apologies for the mistake. Let's go through the options again:
a.) Good X is an inferior good: An inferior good is a good for which demand decreases as consumer income increases. If Mary increases her consumption of Good X after the price of Good Y decreased, it suggests that Good X is not an inferior good. So, option a) is incorrect.
b.) Good Y is an inferior good: Similarly, if Mary increases her consumption of Good X after the price of Good Y decreased, it does not necessarily imply that Good Y is an inferior good. So, option b) is also incorrect.
c.) Good X and Good Y are complements: Complementary goods are goods that are often consumed together. If Mary increases her consumption of Good X after the price of Good Y decreased, it suggests that there is a positive relationship between the two goods, indicating that they are complements. For example, if Good X is coffee and Good Y is sugar, Mary might consume more coffee when the price of sugar decreases because she needs sugar to sweeten her coffee. So, option c) is the correct answer.
d.) Good X and Good Y substitutes: Substitutes are goods that can be used in place of each other. However, since Mary increases her consumption of Good X after the price of Good Y decreased, it suggests that Good X and Good Y are not substitutes but rather complements. So, option d) is incorrect.
In conclusion, the correct answer is c.) Good X and Good Y are complements.
a.) Good X is an inferior good: An inferior good is a good for which demand decreases as consumer income increases. If Mary increases her consumption of Good X after the price of Good Y decreased, it suggests that Good X is not an inferior good. So, option a) is incorrect.
b.) Good Y is an inferior good: Similarly, if Mary increases her consumption of Good X after the price of Good Y decreased, it does not necessarily imply that Good Y is an inferior good. So, option b) is also incorrect.
c.) Good X and Good Y are complements: Complementary goods are goods that are often consumed together. If Mary increases her consumption of Good X after the price of Good Y decreased, it suggests that there is a positive relationship between the two goods, indicating that they are complements. For example, if Good X is coffee and Good Y is sugar, Mary might consume more coffee when the price of sugar decreases because she needs sugar to sweeten her coffee. So, option c) is the correct answer.
d.) Good X and Good Y substitutes: Substitutes are goods that can be used in place of each other. However, since Mary increases her consumption of Good X after the price of Good Y decreased, it suggests that Good X and Good Y are not substitutes but rather complements. So, option d) is incorrect.
In conclusion, the correct answer is c.) Good X and Good Y are complements.
1 answer