Question

1. If hot dogs are an inferior good, a decrease in income will cause the equilibrium price of hot dogs to rise a. True b. Fals dicale the answer choice that hest cmnletes the statement or answers the question. 2. If the demand curve for a good shifts leftward. a quantity demanded is less at each price. b. quantity demanded remains constant at each price. c. quantity demanded is greater at each price. d. demand is greater at each price. 3. As the price of good X rises, the demand for good Y falls. Therefore, goods X and Y are a. substitutes. b. normal goods. C. complements. d. inferior goods c. none of the above 4. As the price of good A rises, the demand for good B rises. Therefore, goods A and B are a. normal goods. b. inferior goods c. substitutes. d. complements e. none of the above 5. At a price above the equilibrium price, there is a. a shortage. b. a surplus. c. excess demand d. super- equilibrium e, none of the above

Answer 1

1. True

Decrease in income increases demand of inferior goods leading to increase in prices.

2. a. Quantity demanded is less at each prices

3. c. Complements

4. c. Substitutes

5. b. A surplus