Goods a and B Are Complementary Goods

question 320

Multiple Choice

Goods A and B are complementary goods. An increase in the price of good A has occurred. In the market for good B this will lead to

• A) an increase in price and a decrease in quantity.
• B) an increase in price and an increase in quantity.
• C) a decrease in price and a decrease in quantity.
• D) a decrease in price and an increase in quantity.

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Definitions:

Implied Covenant

A legal promise that is not expressly stated but is considered a fundamental part of a contract to ensure fairness and honesty.

Good Faith and Fair Dealing

An implied contractual obligation to act honestly and fairly towards the other party, avoiding taking unfair advantage in a transaction.

Franchise Territory

The specific geographic area granted to a franchisee by the franchisor in which to operate and market the franchised business.

Franchise Termination

The legal ending or discontinuation of a franchise agreement, often involving specific conditions or procedures.