When Gasoline Prices Fall, the Demand for Alternative Fuel Cars

question 5

Multiple Choice

When gasoline prices fall, the demand for alternative fuel cars likely:

• A) falls, lowering their equilibrium price and raising equilibrium quantity.
• B) rises, raising their equilibrium price and quantity.
• C) falls, raising their equilibrium price and lowering equilibrium quantity.
• D) falls, lowering their equilibrium price and quantity.

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Definitions:

Binomial Theorem

A principle in algebra that describes the algebraic expansion of powers of a binomial.

Expand

To express a mathematical expression in an extended form by removing parentheses or factoring, usually by applying the distributive property.

Binomial Theorem

A formula for expressing the powers of sums, which identifies the expansion of a binomial raised to any positive integer power.

Approximate

To estimate or come close to an actual value, not exact but within a reasonable range.