If a Rise in the Price of Product a Causes

question 138

Multiple Choice

If a rise in the price of product A causes the demand for product B to decrease, then

• A) A and B are substitutes.
• B) A and B complements.
• C) B is an inferior good.
• D) B is a normal good.
• E) A and B are both inferior goods.

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Definitions:

Principal

An amount of money borrowed from a lender.

Equity Funds

Investment funds that primarily invest in stocks with the aim of achieving growth by capital gains and dividends for their investors.

Periodic Repayments

Regular payments made over time to settle a debt or loan, often consisting of both principal and interest components.

Profits

The financial gain obtained when the revenue from business activities exceeds the expenses, taxes, and costs of operation.