A new car is typically considered to be a normal good. What would happen to the equilibrium price and quantity of new cars if there is a recession where many people lose their jobs? Oa) The equilibrium price would fall and the equilibrium quantity would rise as demand shifts to the right. Ob) The equilibrium price would rise and the equilibrium price would fall as demand shifts to the left. Og The equilibrium price and quantity would both rise as demand shifts to the right. O d) There would be no change to the equilibrium price or quantity. Oe) The equilibrium price and quantity would both fall as demand shifts to the left.
A new car is typically considered to be a normal good. What would happen to the equilibrium price and quantity of new cars if there is a recession where many people lose their jobs? Oa) The equilibrium price would fall and the equilibrium quantity would rise as demand shifts to the right. Ob) The equilibrium price would rise and the equilibrium price would fall as demand shifts to the left. Og The equilibrium price and quantity would both rise as demand shifts to the right. O d) There would be no change to the equilibrium price or quantity. Oe) The equilibrium price and quantity would both fall as demand shifts to the left.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:A new car is typically considered to be a normal good. What would happen to the
equilibrium price and quantity of new cars if there is a recession where many people
lose their jobs?
a)
demand shifts to the right.
O b) The equilibrium price would rise and the equilibrium price would fall as
demand shifts to the left.
Og The equilibrium price and quantity would both rise as demand shifts to the
right.
The equilibrium price would fall and the equilibrium quantity would rise as
O d) There would be no change to the equilibrium price or quantity.
The equilibrium price and quantity would both fall as demand shifts to the
Oe)
left.
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