Explain the income effect and the substitution effects of a price change for a normal good
What will be an ideal response?
For normal goods, the income and substitution effects work in the same direction. Higher prices lead to a lower quantity demanded, and lower prices lead to a higher quantity demanded.
Economics
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a. True b. False Indicate whether the statement is true or false
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The leader of a federal political party made the following campaign promise: "My administration will improve welfare by increasing national defense without requiring sacrifices elsewhere in the economy." This is an example of a positive statement
a. True b. False Indicate whether the statement is true or false
Economics