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Exam Question

Price effect in indifference curve analysis arises?

  • 1. When the consumer becomes either better off or worse off because price change is not compensated by income change
  • 2. When the consumer is betler off due to a change in income and price
  • 3. When income and price change
  • 4. None of the above

View Answer

Answer 1. When the consumer becomes either better off or worse off because price change is not compensated by income change

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