For Inferior Goods, a Rise in Price Causes

question 40

Multiple Choice

For inferior goods, a rise in price causes

• A)negative income and substitution effects
• B)positive income and substitution effects
• C)a negative income effect and a positive substitution effect
• D)a positive income effect and a negative substitution effect
• E)a positive income effect but no substitution effect

---

Definitions:

Retained Earnings

The portion of a company's profits that is kept or retained rather than distributed to shareholders or used for investment.

Other Revenues and Gains

Accounts that record income from activities that are not part of a business's core operations.

Unrealized Gain

The potential profit on an investment that has not been sold, reflecting an increase in value on paper but not realized as cash.

Dividend Revenue

Income earned from holding shares of a company that pays dividends.