« previous next »

Author Question: If a consumer is compensated for the income effect that occurs when the price of a good increases, ... (Read 39 times)

Alainaaa8

  • Hero Member
  • *****
  • Posts: 576
on: Jul 1, 2018
If a consumer is compensated for the income effect that occurs when the price of a good increases, then his demand curves can never slope upward.
 
  Indicate whether the statement is true or false

Question 2

The amount of money one would have to take from a consumer to harm her by as much as the price increase is called
 
  A) compensating variation.
  B) structured settlement.
  C) equivalent variation.
  D) consumer surplus.
Microeconomics ¦ Perloff ¦ 8th Edition
Buy Test-Bank


sultansheikh

  • Sr. Member
  • ****
  • Posts: 335
Reply #1 on: Jul 1, 2018
Answer to Question 1

True . The demand curve would only include the substitution effect. Even for Giffen goods, dq/dp is negative holding utility constant.

Answer to Question 2

C


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

According to the National Institute of Environmental Health Sciences, lung disease is the third leading killer in the United States, responsible for one in seven deaths. It is the leading cause of death among infants under the age of one year.

Did you know?

Approximately 70% of expectant mothers report experiencing some symptoms of morning sickness during the first trimester of pregnancy.

Did you know?

Signs and symptoms that may signify an eye tumor include general blurred vision, bulging eye(s), double vision, a sensation of a foreign body in the eye(s), iris defects, limited ability to move the eyelid(s), limited ability to move the eye(s), pain or discomfort in or around the eyes or eyelids, red or pink eyes, white or cloud spots on the eye(s), colored spots on the eyelid(s), swelling around the eyes, swollen eyelid(s), and general vision loss.

Did you know?

Although puberty usually occurs in the early teenage years, the world's youngest parents were two Chinese children who had their first baby when they were 8 and 9 years of age.

Did you know?

The first-known contraceptive was crocodile dung, used in Egypt in 2000 BC. Condoms were also reportedly used, made of animal bladders or intestines.

Splash blending occurs when the ethanol is added to a tanker with gasoline and is mixed as the ... Splash blending occurs when the ethanol is added to a tanker with gasoline and is mixed as the ...
Doppler effect Doppler effect
Effect of a catalyst on activation energy Effect of a catalyst on activation energy
Rice noodles are a good gluten-free substitute for pasta Rice noodles are a good gluten-free substitute for pasta
Capital’s Share of Income in a Cross-Section of Countries Capital’s Share of Income in a Cross-Section of Countries
Video: Introduction to Breast Cancer

For a complete list of videos, visit our video library