When Product Prices Change, Consumers Are Inclined to Purchase Larger

question 242

Multiple Choice

When product prices change, consumers are inclined to purchase larger amounts of the now cheaper products and less of the now dearer products.This describes:

• A)the cost effect.
• B)the price effect.
• C)the income effect.
• D)the substitution effect.

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Definitions:

Promotional Items

Products branded with a logo or slogan and distributed at little or no cost to promote a brand, corporate identity, or event.

Direct Expense

Costs that can be directly tied to the production of goods or services, such as raw materials and labor.

Salary Expense

The total amount paid to employees for their services during a specific period, excluding hourly wages.

Shoe Department

A specialized section within a store or business dedicated to selling shoes.