There is a price change such that optimal consumption moves from point A to point B. Circle the correct answers to each of the following questions. (A) The graph above represents an: (a) increase in the price of good X. (b) decrease in the price of X. (c) increase in the price of good Y. or (d) decrease in the price of good Y. (B) Are consumers buying more of good X or less of good X? (C) Are consumers buying more of good X or less of good Y? (D) Which is stronger: the income effect or the substitution effect?

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