An Economic Theory Claims That a Rise in Gasoline Prices

question 115

Multiple Choice

An economic theory claims that a rise in gasoline prices will cause gasoline purchases to fall, Ceteris paribus. The phrase "Ceteris paribus" means that:

• A) other relevant factors like consumer incomes must be held constant.
• B) the gasoline prices must first be adjusted for inflation.
• C) the theory is widely accepted but cannot be accurately tested.
• D) consumers' need for gasoline remains the same regardless of the price.

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Definitions:

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Period

A length or portion of time, often defined by specific start and end dates.

Days

Days refer to periods of 24 hours each, marking the time it takes for the Earth to complete one rotation on its axis.

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