90.2K

Verified Solution

Link Copied!

Question content area top Part 1 Hamptons Glamour Finds a Humbler Home    Lucy Martin collected and sold vintage clothing in the wealthy​ Hamptons, but in the recession of​ 2008, her sales fell. She eventually moved her shop to​ Tannersville, N.Y., where her expenses are 70 percent less than they were in the Hamptons.    ​Source: The New York Times​, December​ 22, 2016 According to the news​ clip, is vintage clothing a normal good or an inferior​ good? If the price of vintage clothing falls and income remains the​ same, explain how the quantity of vintage clothing bought changes. Describe the substitution effect and the income effect that occurs. Question content area bottom Part 1 According to the​ article, vintage clothing is​ _______ good. If the price of vintage clothing falls and income remains the​ same, the quantity of vintage clothing bought​ _______. A. a​ normal; decreases B. an​ inferior; decreases C. an​ inferior; increases D. a​ normal; increases Part 2 If the price of vintage clothing falls and income remains the​ same, the substitution effect​ _______ the quantity of vintage clothing bought and the income effect​ _______ the quantity of vintage clothing bought. A. ​decreases; increases B. ​increases; increases C. ​decreases; decreases D. ​increases; decreases

Answer & Explanation Solved by verified expert

See Answer