An Increase in the Price of a Close Substitute for Good

question 208

Multiple Choice

An increase in the price of a close substitute for good A will:

• A)increase demand, increase price and increase the quantity exchanged.
• B)increase demand, increase price and decrease the quantity exchanged.
• C)increase supply, increase price and increase the quantity exchanged.
• D)decrease demand, decrease price and decrease the quantity exchanged.
• E)do none of the above.

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Definitions:

Unemployment Insurance

A government program that provides temporary financial assistance to workers who have lost their jobs through no fault of their own, aiming to reduce the financial burden of unemployment.

Job Search Effort

The time and resources that an individual devotes to finding employment.

Raises Unemployment

An action or event that leads to an increase in the number of unemployed individuals.

Frictional Unemployment

A form of unemployment that occurs when people are between jobs or are in the process of finding new jobs, usually reflecting short-term movement within the labor market.