The substitution effect from a rise in the price of pizza
A) leads to a movement along the fixed budget line, due to a change in relative prices.
B) increases the quantity demanded of pizza.
C) decreases the quantity demanded of pizza.
D) Both answers A and B are correct.
C
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Which of the following is correct?
a. Recessions have never occurred very close together. b. Sometimes recessions are close together. c. Economic fluctuations are easily predicted by competent economists. d. Spending, income, and production do not fluctuate closely with real GDP.
The demand for labor is likely to decrease if
a. there is a rise in the demand for the good it produces b. the price of a complementary input falls c. the price of a substitute input rises d. there is a decline in the demand for the good it produces e. there is an increase in the number of firms in the market