The Price of Potatoes Falls,and the Quantity of Potatoes Purchased

question 32

Multiple Choice

The price of potatoes falls,and the quantity of potatoes purchased decreases.What can we infer?

• A)The income effect is negative and exceeds the substitution effect.
• B)The income effect is negative and reinforces the substitution effect.
• C)The income effect is positive and exceeds the substitution effect.
• D)The income effect is positive and reinforces the substitution effect.
• E)The income effect is negative and just about offsets the substitution effect.

---

Definitions:

P(Z < 3.00)

A statistical expression indicating the probability of a standard normal variable being less than 3.00.

P(Z > 1.9)

The probability that a standard normal random variable Z exceeds the value of 1.9, commonly used in statistical analysis to find tail probabilities.

Mean

The average of a set of numbers, calculated by dividing the sum of the values by their count.

Standard Deviation

A gauge that evaluates the breadth of fluctuation or spread of dataset values in relation to the central value.