Consider the market for apples. Assuming that apples and oranges are substitutes, an increase in the price of oranges will:
A) decrease the demand for apples, creating a lower price and a smaller amount of apples purchased in the market.
B) increase the demand for apples, creating a higher price and a greater amount of apples purchased in the market.
C) decrease the supply of apples, creating a higher price and a smaller amount of apples purchased in the market.
D) increase the supply of apples, creating a lower price and a greater amount of apples purchased in the market.

Question

Quizplus · Accepted Answer

If oranges are substitutes for apples and the price of oranges increases, consumers are likely to switch to purchasing more apples instead of oranges. This would lead to an increase in the demand for apples, resulting in a higher price and a greater amount of apples being purchased in the market.

Consider the Market for Apples