If the Price of Chocolate Chip Cookies Falls, Then

question 293

Multiple Choice

If the price of chocolate chip cookies falls, then

• A) there is a movement downward along the supply curve of chocolate chip cookies.
• B) the supply curve of chocolate chip cookies shifts leftward.
• C) there is a movement upward along the supply curve of chocolate chip cookies.
• D) the supply curve of chocolate chip cookies shifts rightward.

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Definitions:

Autonomous Consumption

Consumption spending that occurs even when income is zero, representing the basic level of consumption necessary for survival.

Disposable Income

The monetary provision for households post the calculation of income taxes dedicated to saving and spending.

Consumption

The use of goods and services by households, which is a primary component of the economy and influences economic growth.

Induced Consumption

Refers to the portion of consumer spending that increases or decreases with disposable income.