If the Price of a Domino's Pizza Decreases While the Price

question 131

Multiple Choice

If the price of a Domino's pizza decreases while the price of a Pizza Hut pizza is unchanged, we expect the demand for Pizza Hut pizza to:

• A) increase as some consumers switch from Pizza Hut pizza to Domino's pizza.
• B) decrease as some consumers switch from Pizza Hut pizza to Domino's pizza.
• C) remain unchanged.
• D) change depending on what happens to the supply of Pizza Hut pizza.

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Definitions:

Common Stock

Equity ownership in a corporation, giving holders voting rights and a share in the company's profits through dividends.

Retained Earnings

Profits that a company has earned to date, less any dividends or other distributions paid to investors.

Economic Resource

A resource with the ability to produce economic benefits for its holder, typically assets owned by an individual or entity.