-A Shift from D1 to D2 Causes Equilibrium Price to __________

question 152

Multiple Choice

-A shift from D1 to D2 causes equilibrium price to __________ and quantity to __________.

• A)rise;rise
• B)fall;fall
• C)rise;fall
• D)fall;rise

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Definitions:

Mental Accounting

A concept in behavioral economics where individuals categorize and treat money differently depending on its source, intended use, or other psychological factors.

Irrational Behavior

Actions or decisions that do not logically follow from a rational analysis of the situation.

Misperception

A misunderstanding or incorrect interpretation of a situation, often leading to erroneous decisions or beliefs.

Opportunity Costs

The price paid for not choosing the second-best option available when deciding.