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6 Oct 2020
When the price of a normal good falls,
a. both the income and substitution effects combine to cause the quantity demanded to increase.
b. the substitution will cause the people to buy more because the good is relatively less expensive.
c. the income effect will cause the people to buy more because of increased purchasing power associated with the lower price.
d. All of the above are correct.
When the price of a normal good falls,
a. both the income and substitution effects combine to cause the quantity demanded to increase.
b. the substitution will cause the people to buy more because the good is relatively less expensive.
c. the income effect will cause the people to buy more because of increased purchasing power associated with the lower price.
d. All of the above are correct.
Raushan RajLv8
8 Dec 2020
