Chuck Drives Past the Same Gas Station Every Day

question 132

Multiple Choice

Chuck drives past the same gas station every day.He realizes that the gas station always changes its prices on Tuesdays but keeps the price steady the rest of the week.On Saturday,Chuck turns on the news and hears a report projecting that the price of gasoline is going to increase.Holding all else constant,what do you think would happen to Chuck's demand for gasoline on Monday?

• A) His demand would shift to the right.
• B) His demand would shift to the left.
• C) You would see a movement down on his demand curve but no shift.
• D) You would see a movement up on his demand curve but no shift.
• E) You would see nothing happen to his demand curve until the price changed on Tuesday.

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Definitions:

C + I + G Curve

An economic model representing the total spending in an economy, comprising Consumption (C), Investment (I), and Government Expenditures (G).

Regressive Tax

A taxation mechanism where the tax rate effectively decreases as the taxable amount (income or assets) increases, placing a higher relative burden on lower earners.

Investment

Placing capital into assets or projects with the aim of generating growth, returns, or appreciation over time.

Shares

Units of ownership interest in a corporation or financial asset, representing a proportion of the company's capital.