Assume that tea and lemons are complements and that coffee and tea are substitutes. An effective price ceiling on coffee would cause the curve for lemons to shift . Hint: You will need to take a minute to think through this question. You can do it! Think about what is happening in all 3 markets (tea, lemons, coffee). Also, consider how much of each item is actually being exchanged.

You are considering the purchase of one of two machines used in your manufacturing plant. machine 1 has a life of two years, costs $20,000 initially, and then $4,000 per year in maintenance costs. machine 2 costs $25,000 initially, has a life of three years, and requires $3,500 in annual maintenance costs. either machine must be replaced at the end of its life with an equivalent machine. using eac which is the better machine for the firm