The Substitution Effect of a Price Change Describes What Happens

question 184

True/False

The substitution effect of a price change describes what happens to the shift in demand for a good when its price changes.

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Definitions:

Unconditioned Response

An automatic, unlearned reaction to an unconditioned stimulus, such as salivating in response to food, in classical conditioning paradigms.

Meat Powder

A substance used by Ivan Pavlov in his classical conditioning experiments as an unconditioned stimulus to elicit an unconditioned salivation response in dogs.

Salivation

The production and release of saliva in the mouth, often in response to the sight, smell, or taste of food.

Classical Conditioning

An educational method where an indifferent stimulus is linked with a significant stimulus, thereby gaining the ability to provoke comparable reactions.