Suppose There Are Only Two Goods, Apples and Oranges

question 170

Multiple Choice

Suppose there are only two goods, apples and oranges.What, if anything, will happen if the price of each good increases by 15 percent?  

• A) The consumer will substitute apples for oranges. 
• B) The consumer will substitute oranges for apples. 
• C) There is no substitution effect because relative prices have remained constant. 
• D) The consumer will substitute apples for pears

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Definitions:

Social Environment

The surrounding social conditions and cultural context in which individuals live and interact.

Individualistic Cultures

Cultures that emphasize personal achievements and individual rights, often promoting self-expression and independence.

Collectivistic Cultures

Societies that prioritize the goals and well-being of the group over individual achievement and identity.

Initiative

The capacity to assess and initiate things independently, often to take charge before others do.