An increase in consumers' incomes will have what effect on the equilibrium in the restaurant meals market?
A) Price will increase, and quantity will increase.
B) Price will decrease, and quantity will increase.
C) Price will increase, and quantity will decrease.
D) Price will decrease, and quantity will decrease.
E) Price will increase, and quantity will stay the same.

Question

Quizplus · Accepted Answer

An increase in consumers' incomes will lead to an increase in the demand for restaurant meals. As demand increases, the equilibrium price and quantity will both increase. Therefore, the correct answer is A.

An Increase in Consumers' Incomes Will Have What Effect on the Equilibrium