Suppose that today, consumers expect the price of a gallon of gasoline to double in the future. Then today the gasoline
A)demand curve will shift to the right.
B)demand curve will shift to the left.
C)supply curve will shift to the right.
D)supply curve will shift to the left.

Question

Quizplus · Accepted Answer

When consumers expect the price of a good to increase in the future, they are likely to purchase more of it now to avoid paying higher prices later, causing the demand curve to shift to the right.

Suppose That Today, Consumers Expect the Price of a Gallon