Two Goods Are Considered Substitutes Only If

question 102

Multiple Choice

Two goods are considered substitutes only if

• A) a decrease in the demand for one leads to a decrease in the supply of the other
• B) an increase in the demand for one leads to a decrease in the supply of the other
• C) an increase in the price of one leads to an increase in the demand for the other
• D) a decrease in the price of one leads to an increase in the demand for the other
• E) a decrease in the supply of one leads producers to switch to production of the other

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Definitions:

Foreign Aid

Financial assistance provided by one country to another, often for development projects, humanitarian aid, or economic stabilization.

Corruption

Dishonest or fraudulent conduct by those in power, typically involving bribery or the misuse of authority for personal gain.

Capital Intensive

A term used to describe businesses or industries that require substantial amounts of capital investment in machinery, equipment, or other physical assets to produce goods or services.