Question

When the price of summer tank tops falls and you buy more of them because they are relatively less expensive, this is calledA) the substitution effect.B) the income effect.C) the deadweight loss effect. D) the elasticity effect.

Answer 1

The correct answer is A) the substitution effect

Step-by-step explanation:

In other words, the substitution effect is when sales fall because the consumers change into cheaper alternatives when its price rises.