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Suppose Two Events Occur Simultaneously in the Market for Automobiles

Question 21

Multiple Choice

Suppose two events occur simultaneously in the market for automobiles: an improvement in assembly line technology and the economy enters a recession (which decreases consumers' income) .What is likely to happen to equilibrium price?  


A)  Price will rise. 
B)  Price will fall. 
C)  Price will remain the same. 
D)  Price will rise and then fall.

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