An Increase in the Consumption of a Good Resulting from a Reduction

question 139

Multiple Choice

An increase in the consumption of a good resulting from a reduction in price that makes the good cheaper in relation to other goods is called the

• A) substitution effect.
• B) income effect.
• C) real balance effect.
• D) inelasticity effect.

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Definitions:

Malinvestment

The allocation of resources in a manner where the return does not justify the initial investment, often due to poor planning or understanding of the market.

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Electrical devices used to dry and style hair by blowing hot air over it.

Quantity Supplied

The amount of a certain good or service that producers are willing and able to sell at a given price during a specific time period.

Manufacturing Workers

Individuals employed in sectors that involve physical production and assembly of goods, including machinery, textiles, and electronics.