A Demand Curve for a Normal Good Is Downward Sloping

question 51

Multiple Choice

A demand curve for a normal good is downward sloping due to

• A) the substitution effect.
• B) the combination of income and substitution effects.
• C) the income effect.
• D) neither the substitution effect nor the income effect.
• E) the Giffen effect.

---

Definitions:

Critical Values

Specific points on a statistical distribution that are used to decide whether to reject the null hypothesis in hypothesis testing.

Materials Account

An account used to track the cost of raw materials that are bought and used during production processes.

Debit

An accounting entry that results in either an increase in assets or a decrease in liabilities on a company’s balance sheet.

Labour Efficiency Variance

The difference between the actual hours worked and the standard hours allowed for the work performed, often used to assess workforce productivity.