Gabriel Has Set Aside $150 Each Month for His Favorite

Multiple Choice

Gabriel has set aside $150 each month for his favorite activities-going to movies and going to concerts. The price of a movie ticket is $15, and the price of a concert ticket is $30. He currently goes to six movies and two concerts each month. Suppose the price of a movie ticket falls to $10 and, as a result, Gabriel decides to go to seven movies and three concerts each month. Which of the following statements is true?

A) The substitution effect outweighed the income effect.
B) The income effect outweighed the substitution effect.
C) Movies must be an inferior good for Gabriel.
D) Gabriel previously followed the income effect but now follows the substitution effect.