When the price of a normal good rises, the income effect results in ________ in the quantity demanded and the substitution effect results in ________ in the quantity demanded
A) an increase; an increase
B) an increase; a decrease
C) a decrease; an increase
D) a decrease; a decrease
D
You might also like to view...
The purchase of the assets of one steelmaker by another steelmaker might be a violation of the
a. Clayton Act b. Federal Trade Commission Act c. Wheeler-Lea Act d. Celler-Kefauver Anti-Merger Act e. Robinson-Patman Act
An example of price discrimination is the price charged for:
a. troll dolls. b. college admission. c. textbooks. d. diamonds.
Which of the following is an effect of an increase in the price level in an economy?
a. The real value of dollar-denominated assets will fall b. The aggregate expenditure line will shift upward. c. The equilibrium real gross domestic product will increase. d. There will be a downward movement along the aggregate demand curve of the economy. e. The aggregate demand curve of the economy will shift rightward.
If the economy is self-regulating and in a recessionary gap,
A) wages and prices will fall. B) wages will fall, but prices will rise. C) neither wages nor prices will change. D) wages will rise, but prices will fall. E) wages and prices will rise.