The Substitution Effect Argues That a Consumer

question 278

Multiple Choice

The substitution effect argues that a consumer

• A) will always use the additional purchasing power from a price decrease to purchase more of both goods.
• B) will not purchase more of a good when its price falls.
• C) will purchase more of a good that has become relatively cheaper, and less of a good that has become relatively more expensive.
• D) will purchase less of both goods if his or her real income increases.

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Definitions:

Glossopharyngeal Nerve

The ninth cranial nerve, which is involved in tasting, swallowing, and other functions of the throat and mouth.

Trigeminal Nerve

The fifth cranial nerve, responsible for sensory data from the face and head, and motor functions such as biting and chewing.

Chewing Reflex

An involuntary movement of the jaw that occurs in response to the presence of food in the mouth, aiding in mechanical digestion.

Oral Cavity

The mouth, an opening in the body equipped with teeth, tongue, and salivary glands, serving as the beginning of the digestive tract.