The statement, "John buys more of good X as his income increases, Ceteris paribus ," means:
A) John's income is being held constant.
B) John's purchases of good X are being held constant.
C) John's income and purchases of this good are being held constant.
D) the price of good X is being held constant .

Question

The statement, "John buys more of good X as his income increases, Ceteris paribus ," means:
A) John's income is being held constant.
B) John's purchases of good X are being held constant.
C) John's income and purchases of this good are being held constant.
D) the price of  good X is being held constant .

Quizplus · Accepted Answer

The phrase "Ceteris paribus" means "all other things being equal" or "holding other things constant." In this context, it implies that while John's income increases, other factors, such as the price of good X, are being held constant to isolate the effect of income change on the quantity of good X purchased.

The Statement, "John Buys More of Good X as His