The Price of Cereal Rises

question 283

Multiple Choice

The price of cereal rises. As a result, people have cereal for breakfast on fewer days and eat eggs instead. This behavior is an example of

• A) a decrease in the quantity demanded of cereal because of the substitution effect.
• B) an increase in the quantity demanded of eggs because of the income effect.
• C) a decrease in the quantity supplied of cereal because of the substitution effect.
• D) an increase in the quantity supplied of eggs because of the income effect.

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Definitions:

Discrimination

The unjust or prejudicial treatment of different categories of people, especially on the grounds of race, age, sex, or disability.

Self-Serving Bias

The common tendency to attribute successes to personal abilities and failures to external factors.

Defensive Attribution

A psychological process by which individuals assign causes to behaviors or outcomes in a way that defends their self-esteem.

Stereotype

Widely held but fixed and oversimplified images or ideas of a particular type of person or thing, which can often lead to prejudiced attitudes or behaviors.