Sue consumes only sandwiches and soda and is at her best ...

[a0266361136]

Sue consumes only sandwiches and soda and is at her best affordable point. The price of a sandwich falls. The substitution effect is that Sue substitutes ________ for ________. The income effect is that Sue ________.
 
  A) sandwiches; soda; buys less of both goods
  B) soda; sandwiches; buys more soda and fewer sandwiches
  C) sandwiches; soda; buys more of both goods
  D) soda; sandwiches; buys less soda and more sandwiches

Question 2

Goods or services that can be produced only by using unique or rare productive resources tend to have a low elasticity of supply.
 
  Indicate whether the statement is true or false

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Answer to Question 1

C

Answer to Question 2

TRUE

[a0266361136]

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