The Substitution Effect of a Price Increase

question 146

Multiple Choice

The substitution effect of a price increase:

• A) causes the consumer to purchase less of the good that is now relatively more expensive.
• B) causes the consumer to purchase more of the good whose price has risen.
• C) can cause the consumer to purchase either more or less of the good.
• D) has no effect on the amount purchased of either good.

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Definitions:

Founder Effects

A genetic phenomenon where a new population starts from a few ancestors, leading to a reduced genetic variation compared to the original population.

Translation

In genetics, the process of conversion of RNA instructions into proteins.

Macroevolutionary Model

A theoretical framework that looks at the large-scale evolutionary changes that occur over long periods, including the formation of new species and the extinction of others.

Genetic Drift

A mechanism of evolution involving random changes in the frequency of alleles within a population over time, not necessarily driven by natural selection.