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If the commodity is normal then the Income Effect (I.E) and the Substitution Effect (S.E):

A. Both move together and reinforce each other

B. One moves and the other remains constant

C. Move in the opposite direction and neutralize each other

D. Both remain constant

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  1. The Law of Diminishing Marginal Returns can be explained in terms of:
  2. In the real world, some competitive firms owns specialized resources that earn a return called:
  3. When price increases and with it the total outlay on a commodity also increases, it is a case of:
  4. Price discrimination occurs when:
  5. In Revealed Preference Theory, a consumer reveals preference for bundle of:
  6. Utility is:
  7. The demand curve in monopolistic competition (also in kinked demand curve model), which shows the share…
  8. The effects according to which people use those goods which are concerned with distinctive standard…
  9. Elasticity of demand is equal to unity while marginal revenue is:
  10. The price under perfect competition is settled by:
  11. The relationship between MC and MP shown by the marginal cost concept is:
  12. In first degree price discrimination, monopolist takes away :
  13. Economic laws are:
  14. Who is the founder of classical school of thought?
  15. Monopolistic firm can fix:
  16. In case of monopoly, the price charged against the additional unit is:
  17. The utility function u = f(x) is based upon :
  18. In 1776, a famous book An enquiry into the nature and causes of the wealth of nation was written by:
  19. A firm in a position of equilibrium is supposed to be maximizing:
  20. The cobweb model will divergent when the slope of:
  21. Other things remaining the same, when a consumers income increases his equilibrium point moves to:
  22. The number of sellers in duopoly is:
  23. A mixed economy is characterized by the coexistence of:
  24. In substitution effect, we:
  25. In finding equilibrium position of a profitmaximizing firm, which technique is most convenient?
  26. In the short-run, in which one of the following situations would a competitive seller close down (shut-down)?
  27. Average cost means:
  28. In monopolistic competition, the customers are attached with one product because of:
  29. The main objective of the firm is to:
  30. An indifference curve shows the bundles of two goods among which a consumer remains: