A consumer allocates income between clams and mussels.If clams are a normal good, then when the price of clams falls, the consumer will definitely buy
A)more clams and more mussels
B)fewer clams and fewer mussels
C)more clams and fewer mussels
D)fewer clams and more mussels
E)more clams, but the effect of the price change on purchases of mussels cannot be predicted

Question

Quizplus · Accepted Answer

When the price of a normal good like clams falls, the consumer will buy more clams due to the substitution and income effects. However, the effect on mussels is uncertain because it depends on whether mussels are substitutes or complements to clams.

A Consumer Allocates Income Between Clams and Mussels