Due to Covid-19, it is expected that the US economy will contract quickly going into a recession for a (hopefully) short period of time, and as a result of that, incomes will fall. If so, what happens in the markets for inferior goods? Answer choices: Prices and quantities both rise. Prices and quantities both fall. Prices rise, quantities fall. Prices fall, quantities rise. Prices rise and quantities remain unchanged. Prices remain unchanged and quantities fall.
Due to Covid-19, it is expected that the US economy will contract quickly going into a recession for a (hopefully) short period of time, and as a result of that, incomes will fall. If so, what happens in the markets for inferior goods? Answer choices: Prices and quantities both rise. Prices and quantities both fall. Prices rise, quantities fall. Prices fall, quantities rise. Prices rise and quantities remain unchanged. Prices remain unchanged and quantities fall.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Due to Covid-19, it is expected that the US economy will contract quickly going into a recession for a (hopefully) short period of time, and as a result of that, incomes will fall. If so, what happens in the markets for inferior goods?
Answer choices:
Prices and quantities both rise.- Prices and quantities both fall.
- Prices rise, quantities fall.
- Prices fall, quantities rise.
- Prices rise and quantities remain unchanged.
- Prices remain unchanged and quantities fall.
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