If Consumer Income and Prices Increase by the Same Percentage

question 20

Multiple Choice

If consumer income and prices increase by the same percentage,

• A) the consumer will buy more of both goods.
• B) the consumer will buy more of both goods if they are both normal goods.
• C) the consumer will buy less of both goods if they are both inferior goods.
• D) the consumer's utility maximizing bundle stays the same.

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Definitions:

Nonverbal Communication

The process of conveying messages or signaling information through means other than verbal words, such as body language or facial expressions.

Indirect Benefit

An advantage or positive outcome that is not the direct result of an action or policy, often realized over time or through secondary effects.

Insight

The ability to gain an accurate and deep understanding of a person, topic, or thing, often leading to a breakthrough or discovery.

Practicing Delivery

Refers to the repetitive execution or rehearsal of presenting information or a performance to improve skill and confidence.