Given That Chicken and Beef Are Substitute Goods, If the Price

question 32

Multiple Choice

Given that chicken and beef are substitute goods, if the price of chicken decreases substantially, there would be:

• A) an increase in the demand for beef.
• B) a decrease in the demand for beef.
• C) a decrease in the quantity of beef demanded.
• D) no change in the demand for beef.

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Definitions:

Monopolist

A market participant that is the sole provider of a good or service, thus controlling the entire market and having the ability to set prices unilaterally.

Identical Costs

Refers to costs that are the same across different products, services, or processes.

X-Inefficiency

A situation in which a firm fails to utilize its resources efficiently because of a lack of competitive pressure.