Which of the following statements concerning income and substitution effects is not true?
a. Income and substitution effects cause the demand curve to slope downward.
b. When the price of a good falls, real purchasing power increases and consumers can purchase more of all goods.
c. The substitution effect describes the situation in which more of the good whose price has fallen is purchased, and less of all other goods is purchased.
d. A price decrease of one good cannot cause the income effect.
e. Income and substitution effects are related to diminishing marginal utility and consumer equilibrium.
d
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In a typical year, ________ new firms open in the United States
A) more than 400,000 B) more than 1 million C) less than 200,000 D) approximately 125,000
Firms that can effectively price discriminate can increase profitability when they engage in:
A. a price-cost squeeze. B. vertical foreclosure. C. Any of the statements associated with this question are correct. D. limit pricing.