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Stella [2.4K]
3 years ago
14

The – effect means Tommy’s – will shift because he has less purchasing power. As a result, he may choose the regular-size steak

instead of the larger "hunter’s portion" he prefers. The – effect means Tommy may spend some of the money he saved by ordering the smaller steak to order a bigger salad.
Business
1 answer:
dimulka [17.4K]3 years ago
6 0

Answer:

The correct answer is: income effect; budget line; substitution effect.

Explanation:

The change in the price of a product has two effects on the consumption pattern of an individual. The increase in price reduces the purchasing power of the consumer as the consumer will now be able to afford a lesser quantity of that product.

This is known as income effect as the real income of the consumer is changing. This change in real income causes the budget constraint to shift.  

Here in the given example, Tommy's real income will change causing his budget line to shift. Tommy will be able to afford regular size steak.  

By saving money on a steak if he orders a bigger salad this shows the substitution effect. In case of price change when a consumer prefers a cheaper alternative it is called the substitution effect.

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Authority to conduct open market operations, which consists of buying and selling of , rests with the Committee. Reserves equal
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Answer:

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Explanation:

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To increase the money supply, the Fed will purchase bonds from banks to inject money into the banking system.

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3 years ago
A chemical reactor gives a fractional conversion of only 10% of the expensive limiting reactant in the feed stream. Assuming not
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Answer:

Explanation:

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3 years ago
The present national accounting system does not reflect changes in:
Rama09 [41]
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7 0
3 years ago
Aaron earns a weekly salary of $350 plus 7% commission on sales. last week his sales totaled $3200. what was his total pay?
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6 0
3 years ago
On December 31, 2019, Spearmint, Inc., issued $450,000 of 9 percent, 3-year bonds for cash of $461,795. After recording the rela
cluponka [151]

Answer:

Interest expense    18,284.17  debit

Premium on BP        1,965.83 debit

        Cash                                 20,250 credit

Explanation:

procceds 461,795

face value 450,000

premium on bonds payable 11,795

As the cash received exceed the face value then, the bonds were isued at premium.

This will be amortized over the bonds life

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The will post:

the cash disbursement in favor of the bondholder:

450,000 x 9%/2 =  20,250

amortization             (1,965.83)

interest expense:    18.284,17‬

3 0
3 years ago
Read 2 more answers
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