For the Following Scenarios, Explain the Direction of the Substitution

question 23

Essay

For the following scenarios, explain the direction of the substitution effect, income effect, and total effect.
I. The price of good X, a normal good, increases.
II. The price of good X, an inferior good, decreases.
III. The price of good X, a Giffen good, increases.

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Definitions:

Catholics

Followers of the Roman Catholic Church, the largest Christian church, led by the Pope and characterized by its traditions and beliefs in sacraments and apostolic succession.

Temperance Movement

A social movement against the consumption of alcoholic beverages, prevalent in the 19th and early 20th centuries, especially in the United States and the United Kingdom.

Transcendentalists

Philosophy of a small group of mid-nineteenth-century New England writers and thinkers, including Ralph Waldo Emerson, Henry David Thoreau, and Margaret Fuller; they stressed personal and intellectual self-reliance.

Farm Labor

Refers to the workforce involved in the agricultural sector, including both skilled and unskilled workers engaged in farming tasks.