Answer:
Explanation:
Sasha likes to treat herself to a small latte each afternoon. On Wednesdays, when the coffee shop decreases the price of lattes, Sasha buys a large latte instead. ----------- "the substitution effect"
He substitutes large latte with small latte due to fall in price .
The price of chicken nuggets rises from $3 to $3.50 for a box of six. The price of hamburgers stays the same. Mateo used to eat chicken nuggets three times a week. All else equal, he now eats them twice a week.
--------------------------" income effect "
Effective income decreases due to rise in price so demand decreases.
Jack offers Victoria a plate of a dozen chicken wings. Victoria enjoys the first wing the best, the second wing a little bit less, and by the seventh wing, she has had enough and chooses not to eat the remaining five wings
------------------------- " diminishing marginal utility."