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AP® Macroeconomics

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Moderate

Change in Price of a Related Good or Service

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If the price of gasoline declines between 2012 and 2015, we can expect to see the demand for bigger automobiles

A

increase, because fuel and autos are complementary products.

B

remain unchanged, as only the quantity demanded for bigger automobiles will change due to a pricing change.

C

increase, because fuel and autos are substitute products.

D

increase, because supplier's input costs will decrease thereby allowing them to offer bigger automobiles at a lower price.

E

both A and D are correct answers.