Which of the Following Are Substitute Goods

question 106

Multiple Choice

Which of the following are substitute goods?

• A)margarine and butter
• B)peanut butter and jelly
• C)pizza and beer
• D)sports utility vehicles and gasoline

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Definitions:

Short-Run Profits

Short-run profits refer to the excess revenues over costs that a firm can generate in a period where at least one factor of production is fixed.

Long-Run Profits

Earnings that a firm expects to generate over an extended period, taking into account all variable and fixed costs.

Excess Capacity

The situation where a firm produces less than its total output capacity, often due to lack of demand.

Monopolistically Competitive

A market structure where many firms sell products that are similar but not identical, allowing for some degree of market power and price setting.