Assume Gloria is initially in equilibrium and that X and Y are normal goods for her. Then the price of X falls. For Gloria to move to a new equilibrium point her consumption of
A. X must decrease.
B. X must remain constant, but her consumption of Y must decrease.
C. X must increase.
D. both X and Y must decrease.
Answer: C
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When income rises
A) demand for a normal good rises. B) demand for a normal good falls. C) demand for an inferior good rises. D) quantity of a normal good demanded rises.
To attract more bidders, and more aggressive bidders, to your common-value auction
a. withhold relevant information about the value of the object b. don't allow bidders to know how others are bidding c. allow potential bidders ample time to examine the object being sold d. do not hold oral auctions
A firm that is earning zero economic profit should go out of business
a. True b. False Indicate whether the statement is true or false
Over the last 60 years, the average annual growth of real GDP in the United States has been approximately
a. 1 percent. b. 3 percent. c. 5 percent. d. 9 percent.