The income effect from a fall in the price of a gallon of gasoline is shown in the above figure by the movement from
A) point A to point C.
B) point A to point B.
C) point B to point C.
D) point A to point B and then to point C.
C
You might also like to view...
According to the BEA, in the second quarter of 2012 nominal GDP rose by 3.3 percent and real GDP rose by 1.7 percent. The difference between the change in nominal GDP and the change in real GDP could be explained by
A) an increase in prices of final goods and services produced. B) a decrease in prices of final goods and services produced. C) an increase in quantity of final goods and services produced. D) a decrease in quantity of final goods and services produced.
Inflation ________.
A. reduces the buying power of people on fixed incomes B. increases the buying power of everyone's income C. reduces the buying power of everyone's income D. increases the buying power of incomes that rise more slowly than prices