In a recession,consumers have less income to spend.As a result,if dining out is a normal good,then which of the following would happen to the demand curve for dining out?
A) The demand curve would shift leftward.
B) The demand curve would not shift but the price of dining out would rise.
C) The effect on the demand curve is unknown.
D) The demand curve would shift rightward.
E) The demand curve would not shift but the price of dining out would fall.

Question

Quizplus · Accepted Answer

In a recession, consumers have less income to spend, which leads to a decrease in demand for normal goods. Dining out is a normal good, so its demand curve would shift leftward, indicating a decrease in demand at every price level.

In a Recession,consumers Have Less Income to Spend