The Substitution Effect of a Price Change Leads Consumers to ________

question 115

Multiple Choice

The substitution effect of a price change leads consumers to ________ their demand for goods whose prices have risen.The income effect leads consumers to buy less of all ________ goods whose prices have risen.

• A)reduce; normal
• B)increase; inferior
• C)increase; normal
• D)reduce; Giffen
• E)reduce; complement

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Definitions:

External Approval

Seeking validation or acceptance from others, rather than valuing one's own judgement and feelings.

Praise

The expression of approval or admiration for someone or something.

Negative Side Effects

Unintended and undesirable outcomes or reactions caused by a product or action.

Intrinsic Rewards

Internal satisfactions or motivations that come from within an individual, such as personal achievement or the joy of learning.