The Income Effect of a Price Change Is the Effect

question 1

Multiple Choice

The income effect of a price change is the effect on consumption changes as a result of a change in:

• A) income when all prices change in the same proportion.
• B) purchasing power caused by a change in the price of the good.
• C) income caused by a change in the price of labour.
• D) income sufficient to offset the effect of a price change.

---

Definitions:

Intrapersonal Intelligence

A type of intelligence that involves the capacity to understand oneself, including one's emotions, motivations, and thoughts.

Bodily-Kinesthetic Intelligence

A type of intelligence characterized by the ability to control bodily motions and handle objects skillfully.

Spatial Intelligence

The capacity to comprehend, think logically about, and recall the spatial relationships between objects or within spaces.

Divergent Thinking

A thought process or method used to generate creative ideas by exploring many possible solutions.