Ceteris paribus, the fear among travelers created by the 9-11 ...

[pragya sharda]

Ceteris paribus, the fear among travelers created by the 9-11 attacks would have what impact on the market for air travel?
 a. an increase in equilibrium price and an increase in equilibrium quantity.
  b. an increase in equilibrium price and a decrease in equilibrium quantity.
  c. a decrease in equilibrium price and an increase in equilibrium quantity.
  d. a decrease in equilibrium price and a decrease in equilibrium quantity.

Question 2

What is the impact of a 10 billion tax cut on consumer spending, if MPC is equal to 0.8?
 a. 50 billion
  b. 40 billion
  c. 10 billion
  d. 20 billion

[ApricotDream]

Answer to Question 1

d

Answer to Question 2

b