Refer to the diagram. The equilibrium points shown in the diagram along with the price change that produced the shift of the budget line from ab to ac:
A. are consistent with a downsloping demand curve for product K.
B. imply that the consumer's money income has declined, but his or her real income has
increased.
C. imply consumer irrationality since the dearer product is being substituted for the cheaper
product.
D. suggest that K is an inferior good.
A. are consistent with a downsloping demand curve for product K.
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Mary decides to buy a bond from Joe for $100. The money supply will
A) neither increase nor decrease. B) increase by more than $100. C) decrease by $100. D) increase by $100.
When a single candidate is chosen by majority vote in a democracy, the political systems _____
a. tend to become corrupted b. tend to be two-party systems c. tend to be one-party systems d. tend to be three-party systems
Financial capital by itself is not a factor of production; instead it is only a paper claim on economic capital
a. True b. False Indicate whether the statement is true or false
When consumers face rising gasoline prices, they typically
a. reduce their quantity demanded more in the long run than in the short run. b. reduce their quantity demanded more in the short run than in the long run. c. do not reduce their quantity demanded in the short run or the long run. d. increase their quantity demanded in the short run but reduce their quantity demanded in the long run.