What Would You Expect to Happen to the Price and Quantity

question 29

Multiple Choice

What would you expect to happen to the price and quantity of Pepsi if the price of Coke increases and Pepsi develops a new technology that makes its production process more efficient?

• A) The equilibrium price will go up and the equilibrium quantity will go up.
• B) The equilibrium price will be indeterminate and the equilibrium quantity will go up.
• C) The equilibrium price will go down and the equilibrium quantity will be indeterminate.
• D) The equilibrium price will be indeterminate and the equilibrium quantity will go down.
• E) The equilibrium price will go up and the equilibrium quantity will be indeterminate.

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Definitions:

Incubation Step

A phase in the creative process or problem-solving where ideas are subconsciously pondered, leading to innovative solutions.

Graham Wallas

An academic who developed a conceptual framework for understanding how creativity functions, emphasizing the necessity of a period of unconscious processing in creative thought.

Illumination

The moment in the creative process when a person arrives at an insight or solution after a period of reflection.

Creative Process

A sequence of thought and action steps involved in the generation of new ideas, solutions, or artistic expressions.