If leisure is a normal good, an increase in the wage ? A. will always increase the quantity of labor suppliedB. will increase the amount of labor supplied if the substitution effect outweighs the income effect C. will increase the…
The change in consumption that results when a price change moves the consumer along a given indifference curve is known as the ? A. inferior effect B. normal effectC. substitution effect D. complementary effect E. income effect
Refer to Exhibit 4, Suppose that the consumer must choose between buying socks and belts Also suppose that the consumer’s income is €100 Suppose that the price of a pair of socks falls from €5 to €2 The income effect…
Refer to Exhibit 4. Suppose that the consumer must choose between buying socks and belts Also suppose that the consumer’s income is €100 If the price of a belt is €10 and the price of a pair of socks is…
If an increase in a consumer’s income causes the consumer to increase his quantity demand of a good, then the good is ? A. a complementary good B. an inferior goodC. a normal good D. a substitute good
Which of the following is true about the consumer’s optimum consumption bundle? At the optimum ? A. the slope of the indifference curve equals the slope of the budget constraint B. the indifference curve is tangent to the budget constraint…
Which of the following statements is not true with regard to the standard properties of indifference curves ? A. Indifference curves are downward slogB. indifference curves are bowed outward C. Indifference curves do not cross each other D. Higher indifference…
uppose a consumer must choose between the consumption of sandwiches and pizza. If we measure the quantity of pizza on the horizontal axis and the quantity of sandwiches on the vertical axis and if the price of a pizza is…
indifference curves for perfect substitutes are ? A. right angles B. bowed outwardC. straight lines D. nonexistent E. bowed inward
The limit on the consumption bundles that a consumer can afford is known as ? A. an indifference curveB. the budget constraint C. the marginal rate of substitution D. the consumption limits