Assume x and y are the only two goods a person consumes. If after a rise in pX the quantity demanded of y increases, one could say:
a. the income effect dominates the substitution effect.
b. the substitution effect dominates the income effect.
c. it is still impossible to determine whether the substitution or income effect dominates.
d. none of the answers is correct.
b
Economics
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How does a decline in the real interest rate cause an increase in investment?
What will be an ideal response?
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