Figure 21-23 -Refer to Figure 21-23. When the Price of X Is

question 539

Multiple Choice

Figure 21-23
-Refer to Figure 21-23. When the price of X is $80, the price of Y is $20, and the consumer's income is $160, the consumer's optimal choice is D. Then the price of X decreases to $20. The substitution effect can be illustrated as the movement from

• A)D to E.
• B)D to C.
• C)C to E.
• D)E to D.

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Definitions:

Exchange Rate

The worth of one currency in terms of another for conversion purposes, showing the amount of one currency that can be swapped for a different one.