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Answer: B) Both equilibrium price and equilibrium quantity of the second good will decrease
A substitute good is a good that can be used in place of another. In consumer theory, substitute goods or substitutes are goods that a consumer perceives as similar or comparable. So if price of one falls demand for other falls, as people substitute the good with higher price with good with lower price, so when price of apple mac decreases then people substiute a PC with apple mac and demand curve for PC will shift to the left as people demand less of PC. As a result of this shift the equilibrium price and equilibrium quantity of PC will decrease.
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27) Suppose we observe a rise in the prics ot sold. Which one of the following...
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D Question 19 0.1 pts When supply shifts to the right and demand stays constant, the...
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Suppose the government decides to eliminate a binding price floor that it had previously imposed on...
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