Suppose That the Incomes of Buyers in a Particular Market

question 13

Multiple Choice

Suppose that the incomes of buyers in a particular market for a normal good increase and there is also a reduction in input prices. What would we expect to occur in this market?

• A)The equilibrium price would increase, but the impact on the amount sold in the market would be ambiguous.
• B)The equilibrium price would decrease, but the impact on the amount sold in the market would be ambiguous.
• C)Both equilibrium price and equilibrium quantity would increase.
• D)Equilibrium quantity would increase, but the impact on equilibrium price would be ambiguous.

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