The Wal-Mart Effect Is Best Described by Which of the Following

question 36

Multiple Choice

The Wal-Mart effect is best described by which of the following?

• A) As large retailers locate in communities, the put smaller companies our of business
• B) Information technologies have allowed large retailers to maintain good productivity growth rates
• C) Wal-Mart's use of supplier capacity has made it difficult for other companies to find Suppliers
• D) The growth of large retailers has had a negative impact on the environment

---

Definitions:

Inferior Good

A type of good for which demand decreases as the income of the consumer increases, typically because consumers can afford better alternatives.

Substitution Effect

The change in consumption patterns due to a change in relative prices, leading consumers to substitute one good for another more or less expensive good.

Income Effect

The change in an individual's or an economy's consumption resulting from a change in real income.

Normal Good

A product whose demand increases as consumer income rises, indicating a direct relationship between income and demand for the good.