As Consumers' Incomes Decrease, the Demand Curve for Bologna Sandwiches

question 78

Multiple Choice

As consumers' incomes decrease, the demand curve for bologna sandwiches shifts to the right. Therefore bologna sandwiches are:

• A)normal goods.
• B)complement goods.
• C)substitute goods.
• D)inferior goods.

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Definitions:

Bonds

Bonds are debt securities issued by entities such as corporations or governments to raise funds, promising to repay the borrowed money at a specified interest rate over a set period.

Interest

The cost of borrowing money or the income earned from lending money, usually calculated as a percentage of the principal amount.

Forward Contract

A bespoke arrangement between two parties for acquiring or disposing of an asset at a designated price on an upcoming date.

Hedge

An investment made to reduce the risk of adverse price movements in an asset.