Question: assume the cost of certain inputs used to produce artificial...
Assume the cost of certain inputs used to produce artificial Christmas trees increases and, at the same time, the economy moves into a recession, causing the incomes of consumers to decrease. Which of the following will happen to the equilibrium price and quantity of artificial Christmas trees? (Assume artificial Christmas trees are normal goods.)
a. Price will increase; quantity cannot be determined.
b. Price will decrease; quantity cannot be determined.
c. Quantity will increase; price cannot be determined.
d. Quantity will decrease; price cannot be determined.