Which one of the following is always true of the price effect?
A)It leads to a positive income effect.
B)It is positive.
C)It decreases consumption.
D)It leads to a negative income effect.
E)None of the above

Question

Quizplus · Accepted Answer

The price effect can lead to either an increase or decrease in consumption depending on whether the good is normal or inferior, and it can result in either a positive or negative income effect. Therefore, none of the given options are always true.

Which One of the Following Is Always True of the Price