Scooters and Bicycles Are Substitutes

question 137

Multiple Choice

Scooters and bicycles are substitutes. Suppose the price of a bicycle falls. Which of the figures above best illustrates how this fall in price affects the demand curve for scooters?

• A) Figure A
• B) Figure B
• C) Figure C
• D) Figure D
• E) None of the above answers is correct because the change in the price of a bicycle will affect the supply curve NOT the demand curve.

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Definitions:

Net Income

The total profit or loss of a company after all expenses, including taxes and interest, have been subtracted from revenue.

Cash Dividend

A payment made by a corporation to its shareholders, usually as a distribution of profits in the form of cash.

Net Cash

The difference between a company's total cash inflows and outflows within a period.

Cash Dividends

Payments made by a corporation to its shareholders from its profits.