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When the Price of a Normal Good Increases, the Substitution

Question 185

Multiple Choice

When the price of a normal good increases, the substitution effect will:


A) result in the quantity demanded going down so much that the income effect is unable to increase demand.
B) work with the income effect to exert pressure on the quantity demanded to fall.
C) work with the income effect to exert pressure on the quantity demanded to increase.
D) work in a direction opposite the income effect.

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