If the Price of an Inferior Good Rises,the Income Effect

question 30

Multiple Choice

If the price of an inferior good rises,the income effect

• A)will have an uncertain effect on consumption of the good,and the substitution effect will decrease consumption.
• B)will decrease consumption of the good,and the substitution effect will decrease consumption.
• C)and the substitution effect will both increase consumption of the good.
• D)and the substitution effect will both decrease consumption of the good.
• E)will increase consumption of the good and the substitution effect will decrease consumption.

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Definitions:

Proposition

An announcement that expresses a judgment or personal view.

Categorical Proposition

A statement that asserts or denies something about every member of a category, forming the basis of categorical logic.

Negative

Negative, in a logical or mathematical context, refers to the denial or opposition to a statement, proposition, or a value less than zero in algebra.

Declarative English Sentence

A sentence that makes a statement or expresses an opinion, contrasted with interrogative, imperative, or exclamatory sentences.