If the Price of a Brita Water Filtration System Increases

question 81

Multiple Choice

If the price of a Brita water filtration system increases and the quantity demanded of bottled water increases,then these two goods are

• A) substitutes.
• B) complements.
• C) normal goods.
• D) inferior goods.
• E) inelastic goods.

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Definitions:

Materials

The physical components used in the production of goods and services.

Fixed Costs

Costs that do not vary with the level of production or sales, such as rent, salaries, and insurance premiums.

Variable Costs

Expenses that change in proportion to the activity of a business, such as raw material and labor costs.

Accounting Profit

The total revenue of a business minus the explicit costs and depreciation expenses, reflecting the net income on the financial statements.