1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
VikaD [51]
3 years ago
13

Distinguish between the substitution and income effects of a price change. If a good’s price increases does each effect have a p

ositive or negative impact on the quantity demanded?
Business
1 answer:
vesna_86 [32]3 years ago
7 0
The economics concepts of income effect and substitution effect express changes in the market and how these changes impact consumption patterns for consumer goods and services. The income effect expresses the impact of increased purchasing power on consumption, while the substitution effect describes how consumption is impacted by changing relative prices. Different goods and services experience these changes in different ways. Some products, called inferior goods, generally decrease in consumption whenever incomes increase. Consumer spending and consumption of normal goods typically increases with higher purchasing power, in contrast with inferior goods.



Read more: What's the difference between the income effect and the substitution effect? | Investopedia http://www.investopedia.com/ask/answers/041415/whats-difference-between-income-effect-and-substitution-effect.asp#ixzz4wcsy3IOK
Follow us: Investopedia on Facebook
You might be interested in
Net working capital is defined as current assets divided by current liabilities.
Ahat [919]

Answer:

The answer is False.

Explanation:

False, because the net working capital is determined by subtracting all the current liabilities from the current assets. But in the question, it says net working capital is determined by dividing the current assets with current liabilities which is wrong. Therefore, if the current assent is 10000 dollars and current liabilities are 5000 dollars then net working capital is 10000 – 5000 = $5000.

7 0
3 years ago
An artisan who creates customized furniture has a customer who is interested in purchasing several pieces of furniture. The arti
koban [17]

Answer:

2) Set the price of each piece of furniture equal to the marginal cost of producing it.

Explanation:

What happens in two-part tariff is that the producer recovers the entire cost of producing by charging price equal to the marginal cost.

This helps him recover cost and the entire fee the producer charges results in profits eventually. Hence, the profits is the consumer 'surplus' that we calculate given that the price of product is equal to marginal cost.

So answer here is 2- Set the price of each piece of furniture equal to the marginal cost of producing it.

8 0
3 years ago
Orem Corporation's current liabilities are $116,160, its long-term liabilities are $474,240, and its working capital is $162,600
jekas [21]

Answer:

Total long-term assets must equal: d $2,771,640

Explanation:

Orem Corporation's Total Debt (liabilities) = current liabilities + long-term liabilities = $116,160 + $474,240 = $590,400

Debt-to-equity ratio = Total Debt/Total Equity

Total Equity = Total Debt/Debt-to-equity ratio = $590,400/0.24 = $2,460,000

Working capital = Current assets - Current abilities

Current assets = Working capital + Current abilities = $162,600 + $116,160 = $278,760

Basing accounting equation:

Total assets = Current assets + Long-term assets = Total liabilities + Total Equity = $590,400 + $2,460,000 = $3,050,400

Long-term assets = Total assets - Current assets = $3,050,400 - $278,760 = $2,771,640

7 0
3 years ago
explain on how the media can influence public opinion of sports personalities in both a positive and a negative way...
BabaBlast [244]
It can influence public opinion in a positive way by showing classic stories of kids who come from poor families and how it motivated them to stay in school and perhaps even go to college. It can influence public opinion in a negative way by highlighting the use of dangerous performance enhancing drugs (steroids) as well as a hyper-macho culture which has sometimes been seen to encourage bullying or sexual assault.
8 0
3 years ago
According to the path-goal theory, directive leadership will lead to higher employee satisfaction when there is ________ within
lakkis [162]

Answer:

The correct answer here would be Cohesiveness.

Explanation:

Path goal theory is a type of motivational theory, which tells about how leaders can motivate their subordinates in accomplishing the designated goals.  Here directive leadership will help in increasing employees satisfaction when there is cohesiveness with in a work group. Cohesion in the group means that people in the group are working in unity and works towards achieving the goals and also satisfying emotional needs of group members.

8 0
3 years ago
Other questions:
  • In expectancy theory, valence is
    13·1 answer
  • Government can encourage entrepreneurs by
    7·1 answer
  • List A List B 1. Interest a. First cash flow occurs one period after agreement begins 2. Monetary asset b. The rate at which mon
    7·1 answer
  • Jack performs maintenance on the manufacturing machinery, and Charlie performs maintenance on the office computers. Would their
    12·1 answer
  • Venetian Company has two production departments, Fabricating and Assembling. At a department managers meeting, the controller us
    10·1 answer
  • What are the advantages of trimming of fruits ?write​
    8·1 answer
  • Easy Walk, a pet leash company, doesn't conduct customer surveys. If it had it would discover that one of its main leash lines f
    12·1 answer
  • • define the market process, the command process, and the traditional process. How does each process deal with the basic questio
    15·1 answer
  • Microsoft is an example of a company using a(n) _____ strategy. The company produces the majority of its work in its U.S. headqu
    7·1 answer
  • The growth of industrial manufacturing affected skilled tradesmen by:.
    14·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!