QUESTION 20
Suppose you calculate that the equilibrium quantity for a good is
$\frac{1}{2}Y-\frac{1}{4}w-2p_r$
$Q^*(Y, w, p_r) = 40 + \frac{1}{2}Y - \frac{1}{4}w - 2p_r$,
where Q is equilibrium output, Y is median income, w is the wage rate, and $p_r$ is the price of a related good.
Which of the following statements is true regarding the function (select all that are true)?
As wages rise, equilibrium quantity falls.
The related good must be a complement
The related good must be a substitute
This good is a normal good.
This good is an inferior good.