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In microeconomics, the price effect refers to the total change in the quantity demanded of a good resulting from a change in its price. This effect is decomposed into two components: the *substitution effect* and the *income effect*. Two major approaches are used to analyze this decomposition—Hicksian (compensated) and Slutsky (uncompensated) approaches. Hicksian Approach (Compensated Variation) This approach isolates the substitution effect by adjusting income to keep utility constant. Suppose the price of good X falls. The consumer can now afford _____ ______ ___ _____ ____ __________ _________ _______ ____ ______ _________.
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