Sales of snowmobiles tend to
A)increase during a recession and decrease during an expansion.
B)increase smoothly over time.
C)depend only on the snowfall in a given year.
D)increase during an expansion and decrease during a recession.
E)decrease smoothly over time.

Question

Quizplus · Accepted Answer

Sales of expensive leisure items like snowmobiles are often subject to income elasticity, meaning that demand for them fluctuates with income levels. During an economic expansion, people have more disposable income, making them more likely to buy recreational vehicles like snowmobiles. During a recession, the opposite is true, and people are less likely to make these kinds of purchases.

Sales of Snowmobiles Tend to