Multiple Choice
The purchase of a computer by a person for household use would be counted in which category of GDP?
79
views
5. Consumer and Producer Surplus; Price Ceilings and Floors
Consumer Surplus and Willingness to Pay
Multiple Choice
Which of the following is a likely example of substitute goods for most people?
A
Butter and margarine
B
Shoes and socks
C
Printers and ink cartridges
D
Coffee and sugar
Verified step by step guidance1
Understand the concept of substitute goods: Substitute goods are products that can replace each other in consumption, meaning if the price of one increases, the demand for the other tends to increase as consumers switch to the cheaper alternative.
Analyze each pair of goods to determine if they are substitutes or complements. Complements are goods that are used together, so an increase in the price of one decreases the demand for the other.
Consider 'Butter and margarine': These are both spreads used for similar purposes, so if the price of butter rises, people might buy more margarine instead. This fits the definition of substitutes.
Consider 'Shoes and socks': These are typically used together, so they are complements, not substitutes.
Consider 'Printers and ink cartridges' and 'Coffee and sugar': Both pairs are complements because printers need ink cartridges to function, and coffee is often consumed with sugar, so they are not substitutes.
Related Videos
Related Practice
