Microeconomics (Book Only)
12th Edition
ISBN: 9781285738307
Author: Roger A. Arnold
Publisher: Cengage Learning
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Chapter 4.3, Problem 1ST
To determine
The relative
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Assume there are only two goods (X and Y). Assume the relative price of good X, is 2 of good Y. If income doubles, the price of X doubles and the price of Y doubles, what will be the relative price of good Y?
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When Good A and Good B are complements in production and there is a decrease in the price of Good A, what happens in Good B's market?
Chapter 4 Solutions
Microeconomics (Book Only)
Ch. 4.1 - Prob. 1STCh. 4.1 - Prob. 2STCh. 4.1 - Prob. 3STCh. 4.2 - Prob. 1STCh. 4.2 - Prob. 2STCh. 4.2 - Prob. 3STCh. 4.3 - Prob. 1STCh. 4.3 - Prob. 2STCh. 4 - Prob. 1VQPCh. 4 - Prob. 2VQP
Ch. 4 - Prob. 3VQPCh. 4 - Prob. 4VQPCh. 4 - Prob. 5VQPCh. 4 - Prob. 1QPCh. 4 - Prob. 2QPCh. 4 - Prob. 3QPCh. 4 - Prob. 4QPCh. 4 - Prob. 5QPCh. 4 - Prob. 6QPCh. 4 - Prob. 7QPCh. 4 - Prob. 8QPCh. 4 - Prob. 9QPCh. 4 - Prob. 10QPCh. 4 - Prob. 11QPCh. 4 - Prob. 1WNGCh. 4 - Prob. 2WNGCh. 4 - Prob. 3WNGCh. 4 - Prob. 4WNGCh. 4 - Prob. 5WNGCh. 4 - Prob. 6WNG
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- Good B and Good A are substitutes. If the price of Good A rises, what will happen to the demand curve of Good B?arrow_forwardAssume the following events are taking place simultaneously: the prices of gasoline rises, commuting by train becomes more affordable and more comfortable, the price of steel falls, automobile insurance premium increases, and auto-workers' wages decreases. What would happened to the equilibrium price of new cars if new cars are normal goods? Price will fall. a. b. C. d. A B D Price will stay exactly the same. Price will rise. The price change will be ambiguous. a b с darrow_forwardShow graphically, in one graph, what would happen to the equilibrium price and quantity of beef if the price of chicken (a substitute) were to decrease.arrow_forward
- The price of Good X increases by 25 percent, causing the quantity consumed of Good Y to decrease by 10 percent. If everything else is held constant in the economy, we can say with certainty that Good X and Good Y are: substitutes, normal, complementary or inferior?arrow_forwardHow are quantity supplied and quantity demanded affected by changes in prices? Give an example of how these quantities might change if the price decreases.arrow_forwardIs it true that all buyers and sellers are content with the market price if a market is in equilibrium? Describe in detailarrow_forward
- William Gregg owned a mill in South Carolina. In December 1862, he placed a notice in the Edgehill Advertiser announcing his willingness to exchange cloth for food and other items. Here is an extract: 1 yard of cloth for 1 pound of bacon 2 yards of cloth for I pound of butter 4 yards of cloth for 1 pound of wool 8 yards of cloth for 1 bushel of salt a. What is the relative price of butter in terms of wool? b. If the money price of bacon was 20c a pound, what do you predict was the money price of butter? c. If the money price of bacon was 20c a pound and the money price of salt was $2.00 a bushel, do you think anyone would accept Mr. Gregg's offer of cloth for salt?arrow_forwardIn 1950, a phone call at a pay phone cost 5 cents and a first-class stamp cost 3 cents. Today, those prices are 50 cents and 44 cents respectively. What has happened to the price of each good relative to the other? What has happened to the price of each good relative to all other goods?arrow_forwardWhat is an example of a change in relative price compared to a change in general price?arrow_forward
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