Exhibit 3-3 Demand curves Assume that consumers expect the price of gasoline to rise sharply in the future. Which of the graphs in Exhibit 3-3 depicts this effect?

Question

Exhibit 3-3  Demand curves  Assume that consumers expect the price of gasoline to rise sharply in the future. Which of the graphs in Exhibit 3-3 depicts this effect?

Quizplus · Accepted Answer

Graph A shows a leftward shift of the demand curve due to the expectation of a future price increase. This means at any given price, consumers will demand less gasoline because they anticipate it becoming more expensive in the future.

Exhibit 3-3 Demand Curves Assume That Consumers Expect the Price