If There Is an Increase in Income, Which of the Following

question 368

Multiple Choice

If there is an increase in income, which of the following is true?

• A) The demand for complementary goods decreases.
• B) The demand for substitute goods decreases.
• C) The demand for normal goods decreases.
• D) The demand for normal goods increases.
• E) The supply for all goods decreases.

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Definitions:

Shut-Down

A temporary or permanent cessation of operations in a business or factory, often due to financial difficulties or external factors.

Marginal Costs

The additional cost incurred from producing one more unit of a product or service.

Fixed Costs

Expenses that do not fluctuate with changes in production level or sales volume, such as rent or salaries.

Short Run

A period in economic analysis during which some factors of production are fixed, affecting production and cost decisions.