select the correct answer. which phrase describes the substitution effect? a. buying cheaper alternatives…

select the correct answer. which phrase describes the substitution effect? a. buying cheaper alternatives when a product becomes expensive b. replacing existing producers in a market with new producers c. replacing existing products in a market with higher - quality products d. substituting existing technology with a new technology to produce more goods

select the correct answer. which phrase describes the substitution effect? a. buying cheaper alternatives when a product becomes expensive b. replacing existing producers in a market with new producers c. replacing existing products in a market with higher - quality products d. substituting existing technology with a new technology to produce more goods

Answer

Brief Explanations:

The substitution effect in economics occurs when consumers switch to cheaper alternatives as the price of a product rises. This is due to the change in relative prices. Options B, C, and D do not describe the consumer - level response to price changes which is the essence of the substitution effect.

Answer:

A. buying cheaper alternatives when a product becomes expensive