When There Is a Change in Purchasing Power as a Result

question 67

Multiple Choice

When there is a change in purchasing power as a result of a change in the price of a good,economists call it

• A) the real-income effect.
• B) the substitution effect.
• C) marginal utility.
• D) diminishing marginal utility.
• E) the consumer optimum.

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Definitions:

Technology Changes

The process of innovation and improvement in technology, affecting productivity, efficiency, and society's overall way of life.

Depression Phase

An economic downturn marked by a long period of decline in GDP, high unemployment, falling prices, and reduced levels of trade and investment.

Unemployment Rate

The percentage of workers who are jobless and actively seeking positions.

Economic Indicators

Statistics about economic activities that allow analysis of economic performance and predictions of future performance.