In General,the Income Effect of an Increase in the Price

question 37

Multiple Choice

In general,the income effect of an increase in the price of a normal good:

• A) will cause the individual to buy more of that good because they have relatively more income.
• B) will cause the individual to buy less of that good because they have relatively less income.
• C) will cause the individual to buy more of that good because they have relatively less income.
• D) will cause the individual to buy less of that good because they have relatively more income.

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Definitions:

Equity Theory

is a theory of motivation that suggests individuals assess their job satisfaction based on the fairness of the rewards they receive relative to others.

Goal-setting Theory

A framework that suggests specific, challenging goals along with appropriate feedback contribute to higher and better task performance.

Comparable Worth

The concept that jobs of equal value to an organization should receive equal pay, regardless of the gender or minority status of the job holders.

Valence

The value an individual places on the expected outcome of an action or behavior, which can influence their motivation.