Question

 QUESTIN 5

 An increase in the price of a substitute good would cause:

 An increase in the demand of our good and the price would increase

 An increase in the supply of our good and the price would increase

 A decrease in the demand of our good and the price will increase

 A decrease in the supply of our good and the price will fall

 QUESTIN 6

 If there is a freeze in Florida that destroys half of the orange crop there, what effect would that have on California oranges?

 No effect.

 Increase in demand, so increase in price.

 Decrease in demand, so decease in price.

 Decrease in supply, so decrease in price.

 QUESTIN 7

 In economic terms, a market:

 Is a place where buyers and sellers meet

 Is the sum of all buyers and sellers who have the potential to trade with each other

 A product available for sale

 A place of commerce

 QUESTIN 8

 Alternate goods are goods:

 that can be produced using the same resources

 that can be used in place of another

 that go together

 that have a similar use, but are not necessarily substitutes

Answer 1

Question 5

Option 1

An increase in the price of a substitute good will cause an increase in the demand for our good and price will increase. The demand curve for our good will shift to the right.

Question 6

Option 2. California oranges and Florida oranges are substitute goods. So a decrease in supply of Florida oranges would cause an increase in price of Florida oranges. The demand for California oranges will increase and prices will increase.

Question 7

Option 1, where buyers and sellers meet. They do not have to meet personally but should be able to transact business electronically too.

Question 8

Option 4.

Alternate goods serve the same purpose but have different functions. Examples are places of entertainment like theater, cinema, concerts. They serve the same purpose but have different functions.