A Negative Sloped Income Consumption Line Indicates That

question 83

Multiple Choice

A negative sloped income consumption line indicates that:

• A)one of the goods is a Giffen good
• B)the two goods are substitutes
• C)the two goods are complements
• D)one of the goods is normal and the other is inferior.

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Definitions:

Variance

In statistics, variance is a measure of how far a set of numbers is spread out from their average value. It's key in assessing variability and risk.

Risk Premium

The additional return expected by an investor for taking on a higher level of risk.

Risky Asset

An asset that has a significant degree of uncertainty in its returns, often leading to variability in its investment outcomes.

Normal Distribution

A statistical function that represents the distribution of many types of data; it’s symmetric and describes data that clusters around a mean or average.