If,because of a Price Change,both the Income and Substitution Effects

question 141

Multiple Choice

If,because of a price change,both the income and substitution effects are strong for a normal good,this segment of the demand curve must be:

• A)unit-elastic.
• B)vertical.
• C)relatively price-elastic.
• D)horizontal.

---

Definitions:

Type II Error

The error that occurs when the null hypothesis is not rejected when it is actually false, also known as a false negative result.

Type I Error

Mistakenly refusing a true null hypothesis, popularly known as a "false positive."

Nominal Data

Data that are categorized into distinct groups without implying any ranked order among them.

Confidence Level

The probability, expressed as a percentage, that the result of an experiment or study will fall within a specified range of values.