Ceteris paribus,which of the following would you expect to have no effect on the demand curve for new automobiles?
A)A rise in the price of gasoline.
B)Consumer expectations that the price of new automobiles will be lower next year.
C)Consumer expectations that a significant recession will develop and last for a year.
D)An increase in the price of new automobiles.

Question

Quizplus · Accepted Answer

An increase in the price of new automobiles would cause a movement along the demand curve, but it would not shift the entire curve. The demand curve would shift only if there were factors that affect demand other than the price of the good itself. A rise in the price of gasoline, consumer expectations of lower prices in the future, and consumer expectations of a recession all have the potential to shift the demand curve for new automobiles.

Ceteris Paribus,which of the Following Would You Expect to Have