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/strose.blackboard.com assessment_id--2 5447-1 &course-d-72244-1; &content-lda-1538605;_1 &step;: null# c Q search QUESTION 32 uning that beer is a normal good, what will a. Demand will rise O b. Demand will fall O c. Supply would rise O d Demand will fall because students love these beers QUE S T?ON 33 You own two different energy drink brands: "Blue Cow and "600 minute energy." If you reduce the price on "Blue Cow"', sales of "600 minute energy" would O a Increase O b Decrease O c. Not change O d. None of the above QUESTION 34 The demand for a product is more elastic O a. When the product is broadly defined O b. When the expenditure on the product represent a small portion of the O c. In the long-run O d. When it has few substitutes QUESTION 35 The general rule to increase profits when two close complementary brands are jointly owned is O a Increase prices on one brand, keeping the prices of the second brand constant O b Increase prices on one brand, decreasing it for the other O c. Increase prices for both brands O d. Decrease prices for both brands

Explanation / Answer

32. Option A

Explanation: The demand for normal goods rises with a rise in income and falls with a fall in income.

33. Option B

Explanation: These two goods are examples of substitutes. In the case of substitutes, the fall in price of one good results in a fall in demand for the other good.

34. Option C

Explanation: In the long-term people can change their habits or make a change in their consumption pattern or fin another alternative. So, elasticity tends to be higher in the long-term.

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