Prices of commercial airline tickets (assume that this is a normal good)have fallen in recent months.Over this same period,the price of jet fuel has risen and consumer incomes have fallen.Which of the following best explains the falling prices of airline tickets?
A)The supply curve for airline tickets has shifted to the left while the demand curve for airline tickets has shifted to the left.
B)The demand curve for airline tickets has shifted to the left more than the supply curve has shifted to the left.
C)The demand curve and the supply curve for airline tickets have both shifted to the right.
D)The supply curve for airline tickets has shifted to the left more than the demand curve has shifted to the left.

Question

Quizplus · Accepted Answer

The decrease in consumer incomes and increase in jet fuel prices suggest a decrease in demand and increase in supply for airline tickets, which would typically result in a lower equilibrium price. However, the fact that prices "have fallen in recent months" suggests that the decrease in demand was greater than the increase in supply, indicating a leftward shift in the demand curve that was greater than the leftward shift of the supply curve.

Prices of Commercial Airline Tickets (Assume That This Is a Normal