An Increase in the Real Interest Rate Is an Example

question 57

Multiple Choice

An increase in the real interest rate is an example of a

• A) pure substitution effect.
• B) substitution effect and a positive income effect.
• C) substitution effect and a negative income effect.
• D) substitution effect and an income effect whose sign depends on whether the consumer is initially a borrower or a lender.

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Definitions:

Dizygotic

Refers to twins that are formed from the fertilization of two separate eggs by two separate sperm, resulting in fraternal twins that are genetically distinct, akin to regular siblings sharing approximately 50% of their genes.

Epigenetic

The study of changes in gene expression caused by mechanisms other than changes in the underlying DNA sequence.

Individual Differences

Variations among individuals in their psychological traits, behaviors, and physiological responses.

Epigenetic Marks

Chemical modifications to DNA and histone proteins that regulate gene activity without altering the DNA sequence, affecting how cells read genes.