Suppose a Fall in Consumer Income Drives Down the Demand

question 106

Multiple Choice

Suppose a fall in consumer income drives down the demand for lobster while a record harvest increases supply. How would these changes affect the equilibrium price and quantity of lobsters?

• A) Both equilibrium price and equilibrium quantity would decrease.
• B) The equilibrium price would fall, but the effect on the equilibrium quantity cannot be predicted.
• C) The equilibrium price would fall and the equilibrium quantity would increase.
• D) The equilibrium quantity would increase, but the effect on price cannot be predicted.

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Definitions:

Least Interest

A concept in relationship dynamics suggesting that the partner with the least interest in continuing the relationship holds more power.

Homogamy

The practice or tendency of individuals to marry others who share similar social backgrounds, values, or characteristics.

Social Class

A way of categorizing individuals and groups within society based on various indicators such as wealth, occupation, education, and others, affecting their opportunities and lifestyles.

Inherited Diseases

Disorders or conditions that are passed down genetically from parents to their offspring.