A decline in the price of factor A will:Select one;Increase the demand of for complimentary factor BShift the demand curve for A to the rightReduce the demand of for complimentary factor BShift the demand curve for A to the leftDiscourage the consumers from consuming the goods of factor A

Answered: A decline in the price of factor A…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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A decline in the price of factor A will:

Select one;

Increase the demand of for complimentary factor B
Shift the demand curve for A to the right
Reduce the demand of for complimentary factor B
Shift the demand curve for A to the left
Discourage the consumers from consuming the goods of factor A

Expert Solution

Introduction

In economics, two items are deemed as substitutes if they can both meet the same need. Contrary to complimentary items, which are used together and have a bad relationship with one another, consumers can switch from the consumption of one commodity to its alternative in the event of price fluctuations. For instance, the needs for bread and peanut butter are jointly satisfied.

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