-Suppose That a Consumer Used to Be at Point S

question 105

Multiple Choice

-Suppose that a consumer used to be at point S on budget line BB' in Figure 6-5,and is now at point R on line AA'.Which of the following is true?

• A)The price of X rose.
• B)The price of X fell.
• C)The consumer's income fell.
• D)The utility level at point R is higher than at point S.
• E)The substitution effect is positive.

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Definitions:

Recover in Court

The process of obtaining a judicial remedy or compensation through legal proceedings.

Drawee

The party in a financial transaction who is directed to pay a specified amount of money on a check or draft.

Certify

The act of officially recognizing someone or something as having met a particular standard or criteria.

Federal Reserve

The central banking system of the United States, responsible for implementing monetary policy, supervising banks, and providing financial services.