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The Real-Income and the Substitution Effects Reinforce Each Other by

Question 151

Multiple Choice

The real-income and the substitution effects reinforce each other by


A) increasing the consumption of good B when the price of A falls.
B) increasing the consumption of both goods A and B when income increases.
C) decreasing the consumption of good A when the price of good B falls.
D) decreasing the consumption of good A when the price of good A increases.

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