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  • Card 8 / 11:
    As a college student you work at a part-time job, but your parents also send you a monthly “allowance.” Suppose one month your parents forgot to send the check. Show graphically how your budget constraint is affected. Assuming you only buy normal goods, what would happen to your purchases of goods?

    This is a negative income effect. Because your parents’ check failed to arrive, your monthly income is less than normal and your budget constraint shifts in toward the origin. If you only buy normal goods, the decrease in your income means you will buy less of every product.

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Questions & Answers

In some cases, barriers to entry may lead to monopoly.
Sung Reply
what is economic
Abdul Reply
define elasticity of demand
Shalom Reply
difference between microeconomics and microeconomics?
Angel Reply
what is the relationship between production possibility frontier and opportunity cost
Tamali
difference between microeconomics and macroeconomics ?
Angel
what is another word for international trade
Shalom Reply
what is economy society
Shalom Reply
what is law of demand
Sangita Reply
The law of demand states that quantity purchased varies inversely with the price. In other words, the higher the price the lower the demanded quantity.
what monetary policy
Suleiman Reply
what monetary policy ?
Suleiman
if demand and costfuncion of cournot duopolist is, y=20-0.p, y= y1+y2, c1=30+2y1,c2=50+10y2, then find profit function of each firms and their reaction function and also the profit of each firms
Gemeda Reply
what is answer for this question
Gemeda
what is cournot duopoly
Gemeda
It is a model of imperfect competition in which two firms with identical cost functions compete with homogeneous products in a static settling
what is elasticity of deman
Douglas Reply
this is the degree of responsiveness of demand to a little or slight Change in the price of the commodity, price of other commodity and income
Stanley
A comprehensive note on Agriculture
Ezekiel Reply
what is economics
GAME
Economics is a social science that studies human behaviour as a relationship between ends and scarce means which HV alternative uses
Jude
what do we mean price elasticity in other words
Blessed Reply
the degree of responsiveness of s slight change in price of a good at a given time
Jude
what is production possibility frontier
Tamali
adam smith views in economics
Renatus Reply
ok
Amadu
what is a market demand schedule
Blessed Reply
what is budget
Balla
A budget is a plan you make on how you spend your money 💰🤑 either for the month or a year
Blessed
is a scheduled of a consumer, which wisely determind , the commodities and the cost of price in a market
Theophilus
What is demand curve
mohamed Reply
Types of demand curve
mohamed
demand curve is a showing the aggregate of demand whether falling from right to the left in the table above
BULAMA
demand curve is the graphical representation of various quantities of a commodity bought at various prices
Blessed
What is demand
mohamed
demand curve , is a graphical presentation of a demand goods and prices
Theophilus
demand curve is the graphical representation of various quantities of a commodity bought at various prices
Shalom

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Source:  OpenStax, Principles of economics. OpenStax CNX. Sep 19, 2014 Download for free at http://legacy.cnx.org/content/col11613/1.11
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