If the Income Effect of a Price Change Is Negative

question 13

Multiple Choice

If the income effect of a price change is negative and larger in absolute terms than the substitution effect,then the demand curve will be

• A)of indeterminate slope.
• B)downward sloping.
• C)horizontal.
• D)vertical.
• E)upward sloping.

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Definitions:

Standard Deviation

Indicates how much the individual data points in a data set generally deviate from the mean of the data.

Mean

The mean of a collection of numbers, found by summing all the numbers and then dividing by the total number of values.

Standard Deviation

An indicator of the degree of unevenness or spread among values in a statistical set.

Mean

The average value of a set of numbers, calculated by dividing the sum of all the values by the number of values.