The Income Effect of a Lower Price for Good a

question 67

Multiple Choice

The income effect of a lower price for good A

• A)invariably leads a consumer to buy more of good A,because the combination of unchanged money income and lower price raises that consumer's real income or purchasing power
• B)invariably leads a consumer to buy less of good A because the combination of unchanged money income and lower price encourages that consumer to buy more of other goods
• C)may lead to a larger,smaller,or even an unchanged quantity of good A demanded;it all depends on the nature of the good itself
• D)creates a change in the good's relative price and,therefore,causes the consumer to substitute good A in place of other goods
• E)causes a parallel outward shift of the budget line,enabling the consumer to buy more of all goods than before

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A social insurance program in Canada providing retirement, disability benefits, and survivor benefits to eligible individuals.

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