A Decrease in the Price of a Good,holding Income and the Prices

question 96

Multiple Choice

A decrease in the price of a good,holding income and the prices of all other goods constant,is associated with:

• A)a positive substitution effect since consumers increase their consumption of the good as the marginal utility per dollar of the good increases.
• B)a negative substitution effect since consumers decrease their consumption of the good as the marginal utility per dollar spent of the good decreases.
• C)the consumer purchasing fewer of all goods in the consumption bundle.
• D)a shift inward of the budget line.

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Definitions:

Oral Traditions

The practice of passing stories, history, and knowledge through spoken word from generation to generation.

Cultural Values

The core principles and ideals upon which an entire community exists and operates, influencing behaviors, traditions, and norms.

Interdependent Relationship

A relationship between individuals or groups that rely on each other equally for resources, support, or benefits.

Modern-day Treaty-making

The contemporary process of formal agreements negotiation and establishment between sovereign states or between nations and international organizations.