The UAW strike kicked off in the middle of September 2023. As a result, potentially 146,000 auto workers who work for Ford, GM, and Stelllantis could walk off their jobs. The three companies are major producers of traditional gas cars in the U.S. In the meantime, Tesla, the major producer of electric cars, announced another round of price reductions recently for its major models. Assume that the traditional gas car and electric car are substitutes in consumption. Use the supply and demand graph to illustrate how these events would affect the market for traditional gas cars. In particular, what would happen to the equilibrium price and equilibrium quantity of traditional cars? Explain in words the changes in the supply and/or.
The UAW strike kicked off in the middle of September 2023. As a result, potentially 146,000 auto workers who work for Ford, GM, and Stelllantis could walk off their jobs. The three companies are major producers of traditional gas cars in the U.S. In the meantime, Tesla, the major producer of electric cars, announced another round of price reductions recently for its major models. Assume that the traditional gas car and electric car are substitutes in consumption. Use the
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