In general, the substitution effect of an increase in the price of a normal good will cause an individual to buy _____ of that good and _____ of others because it is relatively _____ expensive.
A)more; more; less
B)less; more; less
C)more; less; less
D)less; more; more

Question

Quizplus · Accepted Answer

The substitution effect occurs when consumers react to an increase in the price of a good by consuming less of that good and more of other goods, because the good has become relatively more expensive compared to others.

In General, the Substitution Effect of an Increase in the Price