Question

Suppose there are only 2 goods, apples and oranges. What happens if the price of each good increases by 15%? A. The quantity of apples and oranges demanded will increase.

B. The quantity of apples and oranges demanded will decrease.
C. The quantity of apples demanded will increase, but oranges will decrease.
D. The quantity of oranges demanded will increase, but apples will decrease.

Answer 1

B

Because no average person tends to buy them for a higher cost than before and think that they will buy it after the price of the commodity decreases.

Answer 2

The quantity of apples and oranges demanded will decrease.

Step-by-step explanation:

The correct answer is B. The quantity of apples and oranges demanded will decrease.

When the price of a good increases, consumers tend to buy less of that good. This is because the higher price makes the good less affordable and reduces the quantity demanded.

In this case, if the price of both apples and oranges increases by 15%, consumers will buy less of both goods.