Consumers are worried that the economy will soon slip into a recession and incomes will fall. Assuming that gasoline is a normal good, today the demand curve for gasoline will _____, all else equal.

Question

Quizplus · Accepted Answer

When consumers anticipate a recession and a fall in incomes, they are likely to reduce their demand for normal goods, including gasoline, leading to a decrease in the demand curve.

Consumers Are Worried That the Economy Will Soon Slip into a Recession