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Use the following to answer questions:
Figure: The Consumption of Video Games and E-Books
-(Figure: The Consumption of Video Games and E-Books) Look at the figure The Consumption of Video Games and E-Books. Which chart shows the effects of an increase in the price of video games when video games and e-books are substitutes but not perfect substitutes?
Budget Constraint
The limitations on the consumption bundles that a consumer can afford given their income and the prices of goods.
Consumption Possibilities
The set of all consumption bundles that can be consumed given a consumer’s income and prevailing prices.
Budget Line
A graphical representation of all possible combinations of two goods that an individual can afford given their income and the prices of the goods.
Giffin Good
A type of good for which demand increases as its price increases, contrary to the typical law of demand.
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