Question:If the price of coffee falls, which TWOof the following outcomes would be expected to occur?
A. A rise in the price of tea
B. A fall in the demand for drinking cups
C. A rise in the quantity of coffee demanded
D. A fall in the demand for tea
The correct answers are: A rise in the quantity of coffee demanded and A fall in the demand for tea
解析Coffee and tea are substitute products. Thus, a fall in the price of coffee will result in higher demand for coffee and lower demand for its substitute product, tea. The price of tea might therefore fall. Demand for drinking cups is probably insufficiently related to the consumption of coffee to make them a complementary product to coffee. Even so, lower coffee prices would be likely to raise the demand for drinking cups rather than reduce it.
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