Perfect Substitutes

question 28

Multiple Choice

Perfect substitutes

• A)always have indifference curves with slopes of -1.
• B)always have indifference curves with slopes of 1.
• C)have fixed rates of trading off one good for another.
• D)have horizontal indifference curves.

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Definitions:

Consumers' Income

The total amount of income available to consumers for spending and saving after income taxes have been accounted for.

Equilibrium Price

The market price where the supply of goods matches demand.

Equilibrium Quantity

The amount of goods or services supplied and demanded at the equilibrium price.

Bushels

A unit of volume that is used primarily in the United States to measure agricultural commodities, like grains and fruits.