Use the Figure Below to Answer the Following Questions

question 42

Multiple Choice

Use the figure below to answer the following questions.

Figure 3.5.1
-Initially,the demand curve for good A is D2 in Figure 3.5.1.Suppose good B is a substitute for good A.If the price of B falls

• A)the price of A will rise.
• B)there will be a surplus of good A at P2.
• C)the demand curve for good A will shift from D2 to D3.
• D)the equilibrium quantity of good A will increase.
• E)all of the above are true except B.

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Definitions:

Indemnity

A contractual agreement between parties where one agrees to compensate the other for any loss or damage incurred.

Guarantee

A formal pledge or assurance that certain conditions or obligations will be fulfilled, often serving as security in transactions.

Unwritten Lease

An oral or implied agreement between a landlord and tenant that has not been formalized in writing.

Enforceable Contract

A legally binding agreement between two or more parties that can be enforced by law if not fulfilled by one party.