-In the above figure, the economy initially is at point C. Then the domestic price level rises by 10. A
A) wealth effect would help move the economy to point B.
B) substitution effect would help move the economy to point B.
C) substitution effect would keep the economy at point C.
D) substitution effect would help move the economy to point D.

Question

-In the above figure, the economy initially is at point C. Then the domestic price level rises by 10. A
A) wealth effect would help move the economy to point B. 
B) substitution effect would help move the economy to point B. 
C) substitution effect would keep the economy at point C. 
D) substitution effect would help move the economy to point D.

Quizplus · Accepted Answer

The Answer of 
-In the above figure, the economy initially is at point C. Then the domestic price level rises by 10. A
A) wealth effect would help move the economy to point B. 
B) substitution effect would help move the economy to point B. 
C) substitution effect would keep the economy at point C. 
D) substitution effect would help move the economy to point D.

-In the Above Figure, the Economy Initially Is at Point