Please select correct group Which of the following best describes theincome effect?Group of answer choicesThe price of designer jeans has increased, so thebuying power of your income has been reduced.You purchase 2 new pairs of new jeans instead of3 that year.The bank increases interest rates on savingsaccounts from .04% to 5%, so you start placingmore of your monthly income in that savingsaccount.The gap between the rich and everyone else hasgotten bigger.The price of designer jeans has increased, so youhave less of an incentive to purchase new jeans.You purchase 3 pairs of chinos instead that year.

The demand side is made by the consumers, or purchasers who buy these products supplied by the…

Answered: Please select correct group

Business

Economics

Please select correct group

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

Please select correct group

Which of the following best describes the
income effect?
Group of answer choices
The price of designer jeans has increased, so the
buying power of your income has been reduced.
You purchase 2 new pairs of new jeans instead of
3 that year.
The bank increases interest rates on savings
accounts from .04% to 5%, so you start placing
more of your monthly income in that savings
account.
The gap between the rich and everyone else has
gotten bigger.
The price of designer jeans has increased, so you
have less of an incentive to purchase new jeans.
You purchase 3 pairs of chinos instead that year.

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