As the Relative Price of a Good Falls, the Substitution

question 111

Multiple Choice

As the relative price of a good falls, the substitution effect implies that people buy

• A) more of that good and less of its substitutes.
• B) less of that good and more of its substitutes.
• C) more of that good and more of its substitutes.
• D) less of that good and less of its substitutes.

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Definitions:

Conflict

A serious disagreement or argument, typically a prolonged one.

Caught

Successfully captured or apprehended, especially in the context of pursuing someone or something that is elusive.

Field Goal

A score in various sports made by kicking, hitting, or shooting the ball through a goal or over a crossbar.

Frustration

A feeling of dissatisfaction or annoyance that arises when a person's progress towards a goal is blocked or impeded.