What Is an Example of the Substitution Effect

question 9

Multiple Choice

What is an example of the substitution effect?

• A)Workers choose to provide more hours of labor when the wage rate decreases.
• B)Hiring more labor as long as the marginal product of labor is positive.
• C)The firm expands output when production costs fall.
• D)The firm expands output when production costs increase.
• E)The firm hires more labor when the wage falls because labor has become relatively cheaper compared to the price of other factors of production.

---

Definitions:

Schizophrenia

A psychiatric disorder characterized by distortions in thinking, perception, emotions, language, sense of self, and behavior.

Neurotransmitter Activity

The function of chemical messengers in the nervous system that transmit signals across synapses from one neuron to another.

Genetic Vulnerability

The increased likelihood of developing a disorder based on the genes inherited from one's parents.

Heredity

The genetic transmission of traits from parents to offspring, influencing physical and sometimes behavioral characteristics.