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Social Science Clinic => Economics => Macroeconomics => Topic started by: CharlieWard on Jun 30, 2018

Title: If the demand for fast-food rises as a result of lower income, we would say fast-food is an inferior ...
Post by: CharlieWard on Jun 30, 2018

If the demand for fast-food rises as a result of lower income, we would say fast-food is an inferior good.
 a. True
  b. False
  Indicate whether the statement is true or false

Question 2

Ben N. Jerry prefers to keep his 10,000 retirement savings buried in the backyard. After an increase in the price level, Ben reduces the amount of goods and services he wants to purchase. Ben's rationalization, that now his retirement savings won't buy as much, is consistent with which explanation of the aggregate demand curve's negative slope?
 a. the interest rate effect
 b. the open economy effect
  c. the inflation effect
 d. the wealth effect

Title: If the demand for fast-food rises as a result of lower income, we would say fast-food is an inferior ...
Post by: aidanmbrowne on Jun 30, 2018

Answer to Question 1

True

Answer to Question 2

d

Title: If the demand for fast-food rises as a result of lower income, we would say fast-food is an inferior ...
Post by: CharlieWard on Jun 30, 2018

Thank you :)

Title: If the demand for fast-food rises as a result of lower income, we would say fast-food is an inferior ...
Post by: aidanmbrowne on Jun 30, 2018

Happy to help you