If Products C and D Are Close Substitutes,an Increase in the Price

question 35

Multiple Choice

If products C and D are close substitutes,an increase in the price of C will:

• A) tend to cause the price of D to fall.
• B) shift the demand curve of C to the left and the demand curve of D to the right.
• C) shift the demand curve of D to the right.
• D) shift the demand curves of both products to the right.

---

Definitions:

Criterion Validity

Criterion validity refers to the extent to which a measure is related to an outcome.

Instrument Design

The process of creating tools or systems for specific purposes, often involving considerations of functionality, user experience, and efficiency.

Salary Increase

An upward adjustment to an employee's base compensation as a reward for performance, promotion, or inflation adjustments.

Field Experiment

An empirical study conducted in real-world settings outside of the laboratory to observe and analyze the effects of variables in their natural context.