What is substitution effect

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Q. Assume a consumer who buys cola and ice cream for snacks. Assume that the price of ice cream increases. Which of the following is an example of the substitution effect?

Q. Assume the United States can produce Toyotas at the cost of $16,000 per car and Chevrolets at $12,000 per car. In Japan, Toyotas can be produced at 1,800,000 yen and Chevrolets at 1,200,000 yen.

Reference no: EM1354165

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What is substitution effect : Assume a consumer who buys cola and ice cream for snacks. Assume that the price of ice cream increases. Which of the following is an example of the substitution effect.

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