For Consumers, Goods a and B Are Complementary Goods

question 360

Multiple Choice

For consumers, goods A and B are complementary goods. The cost of a resource used in the production of A decreases. As a result

• A) the equilibrium price of B will fall and the equilibrium price of A will rise.
• B) the equilibrium price of B will rise and the equilibrium price of A will fall.
• C) the equilibrium prices of both A and B will rise.
• D) the equilibrium prices of both A and B will fall.

---

Definitions:

Total Rate of Return

A profitability measure that accounts for the gains or losses from investments over a specific period, including interest, dividends, and capital gain.

Current Yield

The annual income (interest or dividends) divided by the current price of the security.

Yield to Maturity

The total return anticipated on a bond if the bond is held until the end of its lifetime.

Common Stock Dividends

Payments made to shareholders of a company's common stock, usually from the company's earnings.