Multiple Choice
Which statement best explains the substitution effect of a price change?
A) It is caused by a change in relative prices.
B) It affects the consumer's ability, rather than willingness, to purchase a good.
C) It assumes that the consumer substitutes more expensive goods for cheaper ones when income increases.
D) It may cause the consumer to buy less of the good when its price falls.
Correct Answer:

Verified
Correct Answer:
Verified
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