Assume That Consumers Consider Rice and Potatoes to Be Substitutes,so

question 62

Multiple Choice

Assume that consumers consider rice and potatoes to be substitutes,so that when the price of rice rises,consumers purchase less rice and more potatoes.When the CPI is computed following the increase in the price of rice,it takes into account

• A)the increase in the price of rice.
• B)the decrease in the quantity of rice purchased and the increase in the quantity of potatoes purchased.
• C)Both (a)and (b)are correct.
• D)None of the above is correct.

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Definitions:

Active Ingredient

The component in a product, especially in pharmaceuticals, that is responsible for its therapeutic effect.

Marijuana

A psychoactive drug derived from the Cannabis plant, used primarily for medical or recreational purposes.

THC

Tetrahydrocannabinol, the psychoactive compound found in marijuana that is responsible for its mind-altering effects.

Hallucinogens

A class of psychoactive substances that induce perceptual and sensory distortions or hallucinations, often used in recreational settings but sometimes also in therapeutic contexts.