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Questions and Answers
Which of the following is true when Good 1 and Good 2 are perfect complements?
Which of the following is true when Good 1 and Good 2 are perfect complements?
- An increase in the price of Good 2 increases the optimal quantity of Good 2 consumed
- An increase in the price of Good 1 increases the optimal quantity of Good 2 consumed (correct)
- An increase in the price of Good 2 decreases the optimal quantity of Good 1 consumed
- An increase in the price of Good 1 decreases the optimal quantity of Good 1 consumed
What happens to the optimal quantity of Good 1 consumed when the price of Good 1 decreases?
What happens to the optimal quantity of Good 1 consumed when the price of Good 1 decreases?
- The optimal quantity of Good 2 consumed decreases
- The optimal quantity of Good 1 consumed remains the same
- The optimal quantity of Good 1 consumed increases (correct)
- The optimal quantity of Good 1 consumed decreases
What type of relationship exists between Good 1 and Good 2 when they are perfect complements?
What type of relationship exists between Good 1 and Good 2 when they are perfect complements?
- Complementary goods (correct)
- Inferior goods
- Substitute goods
- Normal goods
