Suppose apartment rents increase.What impact will the income effect of the increase have on renters?
A) It will have a greater impact than the income effect of an increase in the price of chewing gum.
B) It will have no impact on the demand curve for apartments, because everything except price is assumed constant.
C) It will have less of an impact than the income effect of an increase in the price of chewing gum.
D) It will be almost negligible, because housing is a necessity.
Correct Answer:
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