Suppose the price of gasoline increases and that sport utility vehicles get poor gas mileage compared to other available cars. One would expect:
A)the demand for gasoline to decrease.
B)the demand for sport utility vehicles to decrease.
C)the demand for sport utility vehicles to increase.
D)the quantity of sport utility vehicles demanded to decrease.

Question

Quizplus · Accepted Answer

With the price of gasoline increasing, consumers are likely to seek more fuel-efficient cars. As sport utility vehicles are not known for their fuel efficiency, the demand for them is likely to decrease. This would lead to a decrease in the quantity of sport utility vehicles demanded.

Suppose the Price of Gasoline Increases and That Sport Utility