After Adjusting for Inflation, a Comparison of the Price of Legwarmers

question 29

Multiple Choice

After adjusting for inflation, a comparison of the price of legwarmers reveals that the price of leg warmers was significantlyhigher in the 1980s than it is today. Which of the following canexplain this?

• A)Jeans become preferable to leg warmers, decreasing the demand for leg warmers.
• B)Leg warmers were fashionable in the 1980s (fact), and hence the high demand drove prices up in the 1980s.
• C)An increase in the price of cotton used to make leg warmers has led to a decrease in the price of leg warmers
• Today.
• D)The expected increase in the price of leg warmers has led to a decrease in the price of leg warmers today.