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Q. X-Corporation produces a good (Called X) that is a normal good. Its competitor, Y-Corp makes a substitute good that it markets under name "Y." Good Y is an inferior good.
a. How will demand for good X change if consumer incomes increase?
b. How will demand for good Y change if consumer incomes increase?
c. How will demand for good X change if price of good Y decreases?
d. Is good Y a lower-quality product than good X? Explain.
What constant yearly rate of inflation would lead to the price rise observed over those two years.
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All the big computer manufacturers have little "Intel Inside" logos in their television advertisement.
Show how the answer depends on the shape as well as location of the supply as well as demand curves.
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Discuss the role of advertising also the desired impact on the industry's demand curve. Contrast this to advertising at the industry level.
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