For Most Goods, the Real-Income Effect of a Price Change

question 272

Multiple Choice

For most goods, the real-income effect of a price change is

• A) small because the good accounts for a small part of the consumer's budget.
• B) small because the decision to buy a good depends only on the income of a consumer.
• C) large because the price of the good is in terms of the currency and the income of the person is also in terms of the currency.
• D) zero because the real-income effect only applies to durable goods.

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Definitions:

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A major artery in the brain that supplies blood to the outer areas of the frontal, temporal, and parietal lobes.

Cerebral Cortex

The outer layer of neural tissue of the cerebrum of the brain, playing a key role in memory, attention, perception, awareness, thought, language, and consciousness.

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The continuation of the thoracic aorta that runs through the abdomen, supplying blood to the abdominal and pelvic organs and the legs.