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Problem 1: Which of the following correctly describes how price adjustments eliminate a shortage?
Select one:
a. As the price rises, the quantity demanded will increase while the quantity supplied decreases.
b. As the price falls, the quantity demanded will increase while the quantity supplied increases.
c. As the price rises, the quantity demanded will decrease while the quantity supplied increases.
d. As price falls, the demand for substitutes rises, getting rid of the shortage.
e. As the price falls, the quantity demanded will decrease while the quantity supplied increases.
Problem 2: When a decrease in the price of good A causes an increase in demand for good B, the goods are ________.
a. inferior
b. complements
c. normal
d. substitutes
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