Assume that Tonya consumes only two products, pizza and potato chips, out of a given budget. Both are normal goods for Tonya. If the price of pizza decreases, then Tonya's consumption of pizza will:
A. Decrease due to the income effect
B. Decrease due to the substitution effect
C. Increase due to the income effect
D. Increase due to the law of diminishing marginal utility
C. Increase due to the income effect
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U.S. residents come to believe that the dollar will depreciate in the future, that is, the exchange rate in the future will be lower than the current exchange rate. As a result
A) the demand curve for dollars shifts rightward. B) the demand curve for dollars shifts leftward. C) there is a movement upward along the demand curve for dollars. D) None of the above answers are correct.
The U.S. economy is relatively closed in terms of economic activity related to exports and imports
a. True b. False Indicate whether the statement is true or false