If Consumption Changes Because of a Change in a Factor

question 32

Multiple Choice

If consumption changes because of a change in a factor other than the price level,then the

• A) economy moves from one point on an AD curve to another point on the same curve.
• B) AD curve shifts.
• C) economy moves from one point on a short-run aggregate supply (SRAS)curve to another point on the same curve.
• D) SRAS curve shifts.
• E) none of the above

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Definitions:

Causal Thinking

involves understanding the cause-effect relationship between two events or situations, believing one event is the result of the occurrence of the other event.

Value Rationality

A concept in sociology and economics that refers to behavior motivated by a consistent set of ethical or ideological beliefs, as opposed to actions motivated by ends-means calculations.

Ethics

The branch of philosophy that deals with questions about morality and the principles guiding right and wrong conduct.

Affective Action

Actions motivated by feelings, emotions, or affective states rather than rational calculations or norms.