Suppose that the incomes of buyers in a particular market for a normal

ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
icon
Related questions
Question
**Transcription for Educational Website:**

---

**Scenario: Market Adjustment with Income and Input Price Changes**

Suppose that the incomes of buyers in a particular market for a normal good decrease and there is also a reduction in input prices. What would we expect to occur in this market?

**Select one:**

- **a.** Equilibrium quantity would decrease, but the impact on equilibrium price would be ambiguous.
  
- **b.** The equilibrium price would decrease, but the impact on the amount sold in the market would be ambiguous.
  
- **c.** Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous.
  
- **d.** The equilibrium price would increase, but the impact on the amount sold in the market would be ambiguous.

**Options Available:**

- Cross out: [Option A] [Option B] [Option C] [Option D]

---

Note: This section presents a multiple-choice question regarding economic theory, specifically concerning how changes in consumer income and input costs affect market equilibrium in terms of quantity and price.
Transcribed Image Text:**Transcription for Educational Website:** --- **Scenario: Market Adjustment with Income and Input Price Changes** Suppose that the incomes of buyers in a particular market for a normal good decrease and there is also a reduction in input prices. What would we expect to occur in this market? **Select one:** - **a.** Equilibrium quantity would decrease, but the impact on equilibrium price would be ambiguous. - **b.** The equilibrium price would decrease, but the impact on the amount sold in the market would be ambiguous. - **c.** Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous. - **d.** The equilibrium price would increase, but the impact on the amount sold in the market would be ambiguous. **Options Available:** - Cross out: [Option A] [Option B] [Option C] [Option D] --- Note: This section presents a multiple-choice question regarding economic theory, specifically concerning how changes in consumer income and input costs affect market equilibrium in terms of quantity and price.
Expert Solution
steps

Step by step

Solved in 2 steps

Blurred answer
Knowledge Booster
Measurement of Inequality
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
Economics
ISBN:
9780190931919
Author:
NEWNAN
Publisher:
Oxford University Press
Principles of Economics (12th Edition)
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education