In the above figure, income is $8, the price of a soft drink is $1, and the initial price of a milkshake is $2. If the price of a milkshake decreases to $1, the substitution effect is the movement from point ________ to point ________
A) a; b
B) b; d
C) b; c
D) a; c
A
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If the firm in the figure above is unregulated, the consumer surplus will be
A) zero. B) $100. C) $400. D) $200.
A rightward shift of aggregate demand will raise output only if
A) wages remain unchanged. B) wages rise by a lower percentage than prices. C) wages rise by the same percentage as prices. D) wages rise by a greater percentage than prices.
If the price level in the United States rises less than the increases in the price levels of other countries, exports of U.S.-made goods will increase
Indicate whether the statement is true or false
Which statement is true?
A. Income is fairly evenly distributed in the U.S. B. The richest 1% of our population has nearly 50% of the income. C. The percentage of Americans below the poverty line has been falling steadily (except for recession) since the 1950s. D. Eleven percent of the children under six living in a two parent home are poor.