What Is a Factorial Design? What Is the Primary Advantage

question 46

Essay

What is a factorial design? What is the primary advantage of conducting an experiment using a factorial design versus simultaneous or sequential experiments with single factor manipulations in each experiment?

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Definitions:

Income Effect

The alteration in the income of either a person or an economy and the impact this change has on the demand for a specific product or service.

Inferior Good

A type of good for which demand decreases as the income of the consumer increases, opposite to normal goods.

Substitution Effect

The change in consumption patterns due to a change in the price of goods, leading consumers to substitute one good for another.

Income Effects

The shift in income for either an individual or an economy, and its subsequent effect on the amount of a good or service desired.