Ceteris paribus, if buyers expect the price of airline tickets to fall in the future, then right now there should be
A. A decrease in the supply of airline tickets.
B. No change in the supply of or demand for airline tickets because the price is not changing right now.
C. An increase in the demand for airline tickets.
D. A decrease in the demand for airline tickets.
Answer: D
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If firms sell exactly what they expected to sell, all of the following will be true except
A) aggregate expenditure will be greater than GDP. B) there is no unplanned change in inventories. C) aggregate expenditure will be equal to GDP. D) inventories will not change, and GDP and employment will remain stable.
According to the equation of exchange, if the money supply is $800 million, real GDP is $3,000 million, and nominal GDP is $4,000 million, then the velocity of money is equal to:
a. 3.5. b. 1.7. c. 10.3. d. 5. e. 2.