The Income Effect of an Increase in the Price of Backpacks

question 171

Multiple Choice

The income effect of an increase in the price of backpacks (a normal good) is a(n)

• A)decrease in the demand for backpacks
• B)decrease in the quantity demanded of backpacks
• C)increase in the demand for backpacks
• D)increase in the quantity demanded of backpacks
• E)new demand curve because everything else is no longer constant

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Definitions:

Transfer of Land

The legal process by which ownership of a piece of land is moved from one party to another.

Statute of Frauds

A legal principle requiring certain types of contracts (e.g., real estate transactions, contracts not to be performed within one year) to be in writing to be enforceable.

Partially Performed

A term referring to a contract or agreement that has been started but not fully executed or completed.

Intended To Be Bound

A principle indicating that parties involved in an agreement wish and intend to be legally obligated under that agreement.