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When prices rise, income buys less.

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Q: When prices rise what happens to income?
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Happens when prices rise quickly?

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Happens when prices rise very quickly?

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Why did stock prices rise in the 1920's?

During the 1920's, people received more income. So, they spent more and stock prices began to rise.


What happens if only income increases?

If only income increases, an individual's purchasing power will increase, allowing them to afford more goods and services. However, if prices also increase at the same time, the purchasing power may remain unchanged or even decrease if prices rise more than income. It is important to consider the impact of inflation on the real value of income.


What happens to prices when demand is greater than suply?

They rise. Supply & demand.


Why in these times when inflation happens as a consequence of prices rising its considered a threat but in the 60s when prices rose under normal circumstances it was not considered a threa?

In normal circumstances prices rise gradually ,but in times of inflation they rise rapidly


What happens to prices and output in short run when Short-run aggregate demand shifts left?

Prices rise, output rises


What happens if incomes rise and demand increases?

we would pay a lot of money in income taxes


What happens to demand when income increases and the commodity does not grow?

When income rises, and the quantity of a commodity remains stable, one can expect a number of things to happen. One is that the price of the commodity will rise. That of course ties into the fact that demand will rise with higher income. Eventually, however, the quantity of the commodity will rise to meet demand.


If there is an increase in the money supply that causes money to lose its purchasing power and leads to inflation what happens to prices?

they rise


If there is an increase in the money supply that cause money to lose it purchasing power and leads to inflation what happens to prices?

they rise