Which of the Following Statements About the Substitution Effect of a Price

question 229

Multiple Choice

Which of the following statements about the substitution effect of a price change is true?

• A)It is caused by a change in relative prices.
• B)It affects the consumer's ability, rather than willingness, to purchase a good.
• C)It assumes that the consumer substitutes more expensive goods for cheaper ones when income increases.
• D)It is usually equal to the income effect.
• E)It may cause the consumer to buy less of the good when its price falls.

---

Definitions:

Parallelism

In writing or speech, refers to the use of components in a sentence that are grammatically the same; or similar in their construction, sound, meaning, or meter.

Serif Typefaces

A font style characterized by small lines or decorative features attached to the end of letters and symbols.

Short Phrases

Concise strings of words used for emphasis, clarity, or impact in communication.

Proofreading Method

A systematic process used to check written text for grammatical, typographical, or punctuation errors before finalizing it for publication or submission.