Which One of the Following Is Always True of the Income

question 44

Multiple Choice

Which one of the following is always true of the income effect?

• A)It leads to a positive income effect.
• B)It is positive.
• C)It decreases consumption.
• D)It leads to a negative income effect.
• E)None of the above

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Definitions:

Legally Sufficient Consideration

refers to something of value or a promise exchanged between parties in a contract that is recognized by law as adequate to establish a binding agreement.

Preexisting Duty

An obligation that a party is already legally required to perform, which cannot serve as the basis for new consideration in a contract.

Sump Pump

A device used to remove accumulated water from a sump basin, commonly found in the basements of homes.

Moral Obligation

A duty or commitment that is not legally enforceable but is based on ethical or moral considerations.