Answer to Question #39201 in Microeconomics for VISNURUPAN A/L K.BASKARAN
2. Starbucks, Chatime, The coffee Bean & Tea Leaf and Dunkin Donuts are some of the shops that are selling coffee and tea to their customers by the name of McCafe. Even fast food companies such as McDonald now sell coffee to their customers by the name of McCafe. The product is considered as a substitute good where if the price of coffee is increased people will go for tea and vice versa. Explain the substitute effect and the choice that a consumer makes under this effect.
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