Even Though Two Events Are Related (Nonindependent),this Does Not Necessarily

question 15

Multiple Choice

Even though two events are related (nonindependent) ,this does not necessarily mean that:

• A)one is dependent on the other
• B)one causes the other
• C)the joint probability is 0
• D)a and c

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Definitions:

Production Costs

The total expenses incurred in the process of creating and manufacturing a product.

Substitution Effect

The economic principle that as the price of a good increases, consumers will replace it with cheaper alternatives, whereas if the price decreases, the good will become more preferable.

Output Effect

The effect that changes in the price level have on production due to the incentive for producers to increase supply when the price is higher.

Profit-maximizing

The method a company uses to identify the pricing and production volume that maximizes profit.