When the Price of a Good Changes,the Substitution Effect Occurs

question 97

Multiple Choice

When the price of a good changes,the substitution effect occurs because:

• A)the consumers' real income measured in terms of that good changes.
• B)the relative price of that good changes compared to other goods in the consumption bundle.
• C)the total utility of that good changes.
• D)the marginal utility of that good changes.
• E)consumers have an incentive to substitute irrational behavior for rational behavior.

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Definitions:

Duty of Diligence

The obligation to perform tasks, responsibilities, or research with careful and persistent effort to avoid harm to another party.

Fiduciary Duty

A legal obligation of one party to act in the best interest of another when entrusted with care of money, property, or sensitive information.

Duty of Diligence

An obligation to exercise reasonable care and diligence in the performance of obligations, typically referring to the conduct expected of directors, officers, and professionals.

Conflict of Interest

A situation where an individual's personal interests could interfere with their professional duties or responsibilities.