If the Price of Grapefruit Rises, the Substitution Effect Due

question 236

Multiple Choice

If the price of grapefruit rises, the substitution effect due to the price change will cause

• A) a decrease in the demand for grapefruit.
• B) a decrease in the demand for oranges, a substitute for grapefruit.
• C) a decrease in the quantity demanded of grapefruit.
• D) a decrease in the quantity supplied of grapefruit.

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Definitions:

Partnership

A business entity legally established by two or more partners who equally share in managing the business and its profits.

Legal Idiom

A set phrase or expression that has acquired a specialized meaning in the legal profession, often different from its literal meaning.

Possession

The state or fact of owning or holding something, legally or physically.

Recessionary Period

A time of economic decline during which trade and industrial activity are reduced, generally identified by a fall in GDP in two successive quarters.