The income effect of a price increase of a normal good is to ________ of that good and the substitution effect is to _________ of that good?

Related Mcqs:

Which of the following will NOT cause a shift in the demand curve for compact discs ?

A. A change in wealth B. A change in the price of compact discs C. A change in income. A change in the price of pre-recorded cassette tapes...

An increase in price from 25 pence to 30 pence leads to an increase in the quantity supplied from 40 units to 44 units. The price elasticity of supply is ?

A. +2 B. +0.5 C. -2 D. -0.5...

Profits are maximized when ?

A. costs are minimized B. revenue is maximized C. average cost is less than average revenue D. marginal cost equals marginal revenue...

According to the law of diminishing utility ?

A. Utility is at a maximum with the first unit B. Increasing units of consumption increase the marginal utility C. Marginal product will fall as more units are consumed D. Total utility will rise at a falling rate as more units are consumed...

A measurement showing how quantity demanded varies with income is the ?

A. Price elasticity of demand B. Cross-price elasticity of demand C. budget elasticity of demand D. income elasticity of demand...