Monday, July 30, 2012

Price and income effect


 Types of price effect
1. pcc is horizental :-price of x-goods changed but y-goods is constant
2. pcc is upward sloping :- x and y goods are complymentry
3. pcc is backward slopping :- if one goods is inferior
 Income effect
Types of Income effect         
normal goods
inferior goods
neutral goods

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