PRC-3 · Chapter 10 · Question 10 of 70
Consumers hear a credible news report that the price of cooking oil will double next month due to an international crisis. What is the immediate effect on the current market for cooking oil?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) Current demand shifts to the right as consumers stockpile
Explanation
Expectations of higher future prices cause consumers to buy more now, shifting the current demand curve to the right.
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