Income And Price Effecfs :

Question 1

Income expansion path

Answer 1

The path connecting the optimal consumption bundles that shows how a consumer changes his quantity demanded of specified goods as his income changes and the prices remain the same

Question 2

Expansion path for inferior and superior goods

Answer 2

1- vers la gauche

2- vers la droite proche de la IEP parfait

Question 3

The substitution effect :

Answer 3

The substitution effect is the change in consumption patterns due to a change in the relative prices of goods.

Question 4

Income effect

Answer 4

The income effect is the change in consumption patterns due to the change in purchasing power.