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问题如下：

A man earns $3,000 per month and allocates $300/month for bus travel to visit his children three times per month. The bus company lowers the cost such that he can now take four trips a month for $320, which he decides to do. His decision to visit his children more often is most likely due to which economic effect?

选项：

A.Income effect alone

B.Substitution effect alone

C.Income and substitution effects combined

解释：

Solution

C is correct. The increase in travel is a result of both the income and the substitution effects. His earnings of $3,000/month have not changed, but because the price has fallen, if he continued to take three trips a month, he would have extra income available. This increase in purchasing power, or real income, is the income effect. The substitution effect is when a consumer buys more of a good when the price falls, as this consumer does by taking four trips instead of three and now allocating more of his budget to bus travel.

A is incorrect. There has been an income effect from the decrease in the price of bus travel, leaving him more income if he continues to take only three trips, but that alone does not account for the man’s behavior.

B is incorrect. The substitution effect is when a consumer buys more of a good when the price falls, as this consumer does by taking four trips instead of three and now allocating more of his budget to bus travel. But there is also an income effect from the decrease in the price.

中文解析：

C正确。旅游增加是收入效应和替代效应共同作用的结果。他每月3000美元的收入没有改变，但由于价格下降，如果他继续每月旅行三次，他就会有额外的收入。这种购买力或实际收入的增加就是收入效应。替代效应指的是，当价格下跌时，消费者会购买更多的商品，比如他会去四次而不是三次旅行，现在他会把更多的预算花在公共汽车旅行上。

A不正确。公交票价的下降对收入产生了影响，如果他继续只乘三次车，他就会有更多的收入，但这并不能解释这个人的行为。

B不正确。替代效应是指当价格下降时，消费者会购买更多的商品，就像这个消费者乘坐四次而不是三次，现在将更多的预算分配给巴士旅行。但价格下跌也会对收入产生影响。