Refer to Scenario 3

question 297

Multiple Choice

Refer to Scenario 3.2 below to answer the question(s) that follow.
SCENARIO 3.2: Lettuce and spinach are substitutes. Lettuce and tomatoes are complements. Lettuce is a normal good. During the winter, about 20% of the lettuce crop was destroyed by flooding.
-Refer to Scenario 3.2. The floods that destroyed part of the lettuce crop would have caused the equilibrium price of spinach to ________ and the equilibrium quantity of spinach to ________.

• A) decrease; decrease
• B) decrease; increase
• C) increase; increase
• D) increase; decrease

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Definitions:

Substantially Impaired

Refers to significant damage or deterioration, often in the context of property or assets, affecting value or functionality.

Revoke Acceptance

The act of legally rejecting a previously accepted offer or product due to defects or contract breaches.

Partial Acceptances

In business and contract law, the agreeing to or approval of a portion of a proposal or offer, rather than the whole.

Nonconforming

Items or actions that fail to meet specified standards, regulations, or expected norms.