If an Increase in the Price of Coffee Leads to an Increase

question 31

Multiple Choice

If an increase in the price of coffee leads to an increase in the demand for tea, then coffee and tea are likely to be

• A) complements.
• B) inferior goods
• C) normal goods
• D) substitutes

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Definitions:

Accounts Receivable

The money owed to a company by its customers for goods or services delivered on credit but not yet paid for.

Income Statement

A financial statement that reports a company's financial performance over a specific accounting period, detailing revenue and expenses to show net income or loss.

Operating Activities

The portion of a company's cash flow statement that deals with the cash inflows and outflows from its core business operations.

Accounts Receivable

Money owed to a business by its customers for products or services delivered on credit.