If Red Bull and Beaver Buzz Energy are considered substitutes, then, other things equal, an increase in the price of the Red Bull will
A)decrease the demand for the Red Bull.
B)increase the demand for the Beaver Buzz Energy.
C)increase the quantity demanded for Beaver Buzz Energy.
D)increase the quantity demanded for the Red Bull.

Question

Quizplus · Accepted Answer

When two products are considered substitutes, an increase in the price of one product (Red Bull) will lead to consumers shifting to the other product (Beaver Buzz Energy) as a replacement. This means that the demand for the Red Bull will decrease, while the demand for the Beaver Buzz Energy will increase. However, it's important to note that this increase in demand for the Beaver Buzz Energy will only be in the short run. In the long run, consumers may adjust their habits and preferences to find other substitutes, leading to a permanent decrease in demand for Red Bull.

If Red Bull and Beaver Buzz Energy Are Considered Substitutes