Question

Identify which of the following would generate a decrease in the market demand for​ e-book readers, which are a normal good.
I. An increase in the price of downloadable apps utilized to enhance the​ e-book reading​ experience, which are complements.
II. An increase in the number of consumers in the market for​ e-book readers.
III. A decrease in the price of tablet​ devices, which are substitutes.
IV. A reduction in the income of consumers of​ e-book readers.
A. Both III and IV.
B. Only IV.
C. ​I, III and IV.
D. Both I and IV.

Answer 1

Answer:

C. ​I, III and IV

Explanation:

I. An increase in the price of downloadable apps utilized to enhance the​ e-book reading​ experience, which are complements.

III. A decrease in the price of tablet​ devices, which are substitutes.

IV. A reduction in the income of consumers of​ e-book readers.