Asked by Kajal Barsiwal on Jul 29, 2024
Verified
Sugar and honey are viewed as substitutes for each other in many cooking applications.If the price of sugar rises,we would expect:
A) the demand for honey to increase.
B) the demand for honey to decrease.
C) the quantity demanded of honey to decrease.
D) the price of honey to decrease.
E) the quantity demanded of honey to increase.
Substitutes
Goods, such as tacos and pizza, that relate in such a way that an increase in the price of one shifts the demand for the other rightward.
Honey
A sweet, viscous food substance made by bees from the nectar of flowers.
- Examine the impact of price fluctuations on consumer choices, focusing on the substitution and income effects.
- Examine how complements and substitutes affect the demand for a merchandise.
Verified Answer
SK
Sigrid KleiveJul 30, 2024
Final Answer :
A
Explanation :
Sugar and honey are viewed as substitutes for each other in many cooking applications. If the price of sugar rises, consumers may switch to honey as a substitute, which would increase the demand for honey. Therefore, the best choice is A - the demand for honey to increase.
Learning Objectives
- Examine the impact of price fluctuations on consumer choices, focusing on the substitution and income effects.
- Examine how complements and substitutes affect the demand for a merchandise.