Answer to Question #85123 in Microeconomics for Ayanda Lubisi

Question

The substitution effect of a price decrease for a good with a normal indifference curve
pattern …

1. is always inversely related to the price change
2. measures the change in consumption of the good, which is due to the consumer
feeling richer.
3. is measured by the horizontal distance between the original and the new indifference
curves.
4. provides sufficient information to plot an ordinary demand curve for the commodity
being considered

Answer 1

(1) is always inversely related to the price change.