JoAnn Considers Cola and Plain Sparkling Water to Be Good

question 48

Multiple Choice

JoAnn considers cola and plain sparkling water to be good substitutes. Suppose the price of sugar, a key ingredient used to produce cola, falls. According to the substitution effect, which of the following is most likely to occur?

• A) JoAnn will purchase less cola and more sparkling water.
• B) JoAnn will purchase more cola and less sparkling water.
• C) JoAnn will purchase more of all goods due to her higher real income.
• D) JoAnn's demand curve will decrease (shift in), causing her to purchase less cola.

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Definitions:

Futurist Movement

An early 20th-century art and social movement originating in Italy, emphasizing speed, technology, youth, violence, and objects such as the car, airplane, and industrial city.

Early-20th-Century

A term referring to the period from 1901 to 1945, marked by significant cultural, social, and political changes worldwide.

Italy

A country in Southern Europe, known for its significant contributions to art, architecture, fashion, cuisine, and Western culture.

Degenerate

Originally used in physical and biological contexts to describe decline or decrease in function, the term can also refer to moral or cultural decline.