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Question 66Asked in DSSSB TGT Computer Science (Technical), 1 Aug 2021, Shift 3

Which of the following effects of the price change can influence the consumer's optimal choice?

Which of the following effects of the price change can influence the consumer's optimal choice? I. The change in the relative price of a good. II. The change in the purchasing power of a consumer. III. Sudden reduction in the minimum support price of a commodity.
  1. AOnly I
  2. BOnly III
  3. CI and II
  4. DI, II and III
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Correct answer: (C) I and II

Explanation

A price change affects consumer choice through the substitution effect (change in relative price) and the income effect (change in purchasing power). A cut in MSP is not one of these effects.

From DSSSB TGT Computer Science PYQ (Technical), 1 Aug 2021, Shift 3

This is question 66 of DSSSB TGT Computer Science PYQ (Technical), 1 Aug 2021, Shift 3. See all questions of this paper with answers, or attempt the paper as a timed online test to get your score and all-India rank.