You Purchase Both Potatoes and Gasoline Regularly

question 37

Multiple Choice

You purchase both potatoes and gasoline regularly.Your income increases and you purchase more gasoline and less potatoes.This implies that

• A)gasoline has a negative substitution effect.
• B)potatoes are normal goods.
• C)gasoline is an inferior good.
• D)gasoline is a normal good.

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Definitions:

Aggregate Demand

Total pull for goods and services in an economy, measured at a specific wide price level during a prescribed time scope.

Economic Boom

A period characterized by significant expansion in the economy, marked by increased production and consumption, lower unemployment rates, and robust economic growth.

Government Expenditures

Represents the total spending by the government on goods, services, and public works.

Money Supply

The entire pool of monetary assets at a specific point in an economy's timeline.