Which phrase describes the substitution effect?
a.) buying cheaper alternatives when a product becomes expensive
b.)replacing existing producers in a market with new producers
c.)replacing existing products in a market with higher-quality products
d.)substituting existing technology with a new technology to produce more goods

The correct answer is A. Buying cheaper alternatives when a product becomes expensive

Explanation:

In economics the substitution effect refers to the effect a rise in the price of a specific product has on the consumers choice, this implies when the price of some specific product rises and the income of consumers remains unchanged, the consumer will decide to buy similar but cheaper products or the alternative product, substituting more expensive products for cheaper alternatives. Similar results can be obtained if the price of a specific product falls and the product consumers buy remain the same, which will lead consumers to substitute the usual product they buy by the alternative cheaper product. Thus, the phrase that describes substitution is buying a cheaper alternative when a product becomes expensive, which means consumers choose similar but cheaper products if the usual product price rises.