If the Price of a Good Falls and the Consumer

question 78

Multiple Choice

If the price of a good falls and the consumer decides to buy more of the good solely because it is relatively less expensive, this describes the:

• A) income effect.
• B) substitution effect.
• C) consumer surplus effect.
• D) marginal maximizing rule.

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Definitions:

Parasympathetic Stimulation

Activation of the parasympathetic nervous system, leading to responses such as decreased heart rate and increased digestive activity.

Acetylcholine Agonists

Substances that mimic the action of acetylcholine, a neurotransmitter, stimulating the acetylcholine receptor sites.

Sympathetic Stimulation

Activation of the sympathetic nervous system, which increases heart rate, blood pressure, and energy availability; often referred to as the "fight or flight" response.

ANS

The Autonomic Nervous System, a part of the nervous system that controls involuntary actions such as the heartbeat, digestion, and respiratory rate.