If Pencils and Paper Are Complements for Most Consumers, Then

question 132

Multiple Choice

If pencils and paper are complements for most consumers, then if the price of paper increases, you would expect:

• A)the equilibrium price and quantity of pencils to fall.
• B)the equilibrium price and quantity of pencils to rise.
• C)the equilibrium price of pencils to fall and the equilibrium quantity of pencils to rise.
• D)the equilibrium price of pencils to rise and the equilibrium quantity of pencils to fall.

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Definitions:

Economic Stability

A state in which financial markets and the economy are able to function efficiently and enduringly, free from extreme fluctuations.

National Output

National Output is the total value of all goods and services produced by an economy over a specific period, typically measured as GDP.

Inflation

Inflation is the rate at which the general level of prices for goods and services is rising, eroding purchasing power.

Employment

The condition of having paid work, or the relationship between an employer and an employee where the employee provides labor in exchange for compensation.