-Refer to the above figure. Suppose that Cheerios and Apple Jacks are substitutes. Which diagram shows the effect on the demand for Cheerios when the price of Apple Jacks cereal has decreased?
A) A
B) B
C) neither graph
D) both graphs

Question

-Refer to the above figure. Suppose that Cheerios and Apple Jacks are substitutes. Which diagram shows the effect on the demand for Cheerios when the price of Apple Jacks cereal has decreased?
A) A 
B) B 
C) neither graph 
D) both graphs

Quizplus · Accepted Answer

The demand for Cheerios will increase when the price of Apple Jacks decreases because they are substitutes. Graph B shows an increase in demand.

-Refer to the Above Figure