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When the price of chocolate chip cookies increased to $3 per package, Samantha began to buy oatmeal cookies instead. This situation is an example of the The supply curve slopes upward because at a higher
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41 votes
41 votes
When the price of chocolate chip cookies increased to $3 per package, Samantha began to buy oatmeal cookies

instead. This situation is an example of the
The supply curve slopes upward because at a higher price, producers have
to produce more.
The price of shirts declines dramatically. Javier now feels richer and buys more shirts than he normally would. This
situation is an example of the

User Lou Franco
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2 Answers

20 votes
20 votes

substitution effect The supply curve slopes upward because at a higher price, producers have an incentive to produce more.

User Paul Hoenecke
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2.9k points
17 votes
17 votes

Answer: Here go the right answer and I got it right

Step-by-step explanation:

When the price of chocolate chip cookies increased to $3 per package, Samantha began to buy oatmeal cookies instead. This situation is an example of the substitution effect.

The supply curve slopes upward because at a higher price, producers have an incentive to produce more.

The price of shirts declines dramatically. Javier now feels richer and buys more shirts than he normally would. This situation is an example of the

income effect.

User Biotech
by
2.8k points
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