Multiple Choice
Demand functions are "homogeneous of degree zero in all prices and income." This means
A) a proportional increase in all prices and income will leave quantities demanded unchanged.
B) a doubling of all prices will not alter consumption decisions.
C) prices directly enter individuals' utility functions.
D) an increase in income will cause all quantities demanded to increase proportionately.
Correct Answer:
Verified
Correct Answer:
Verified
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