Multiple choice

Match the following.

 
Group - I Group - II
1. Production Effect (i) Mead
2. Consumption Effect (ii) Johnson
3. Production and Consumption Effect (iii) Lerner
4. Radiant of Tangency (iv) Viner

  1. 1 - (ii), 2 - (iii), 3 - (iv), 4 - (i)

  2. 1 - (ii), 2 - (iv), 3 - (iii), 4 - (i)

  3. 1 - (iv), 2 - (i), 3 - (ii), 4 - (iii)

  4. 1 - (iii), 2 - (i), 3 - (iv), 4 - (ii)

  5. 1 - (iv), 2 - (iii), 3 - (ii), 4 - (i)
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

These options are matched correctly.  Viner studied production effect. When the domestic production of goods is reduced or eliminated and instead it is imported from the partner country, this is known as production effect. Consumption effect was studied by Mead. It refers to the increased consumption of the partner country's substitute good for the domestic good, which was formerly available at a higher cost. Johnson combined the production effect and consumption effect systematically in partial equilibrium analysis. Radiant of tangency relates Lerner's view, which is the sign of factor intensity reversal.

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