tulovaikutuksen
The term "tulovaikutus" is a Finnish word that translates to "income effect" in English. It is a concept used in economics to describe how a change in the price of a good or service affects the purchasing power of a consumer's income. When the price of a good falls, consumers can afford to buy more of it with the same amount of money, effectively increasing their real income. Conversely, if the price rises, their real income decreases, limiting their purchasing power.
The income effect is one of two components that explain how changes in price influence the quantity
For normal goods, a decrease in price leads to an increase in quantity demanded due to both