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How Have the Recent Increases in the Price of Gasoline

Question 136

Multiple Choice

How have the recent increases in the price of gasoline affected the market for hybrid cars?


A) The demand has increased, increasing the equilibrium price and quantity of hybrid cars.
B) The supply has increased, decreasing the equilibrium price and increasing the equilibrium quantity of hybrid cars.
C) The demand has increased, decreasing the equilibrium price and increasing the equilibrium quantity of hybrid cars.
D) The demand and supply of hybrid cars have both increased in response to changing gas prices, so the equilibrium quantity has definitely decreased, but the effect on price cannot be determined without more information.

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