#16

Suppose the introduction of new technology and the discovery of new oil deposits in the U.S. causes a large decrease in the income of consumers in the Arab world and an equally large increase in the United States. The graphs show the world automobile market divided into two markets-the U.S. automobile market and the Arab auto market. Suppose that automobiles are normal goods in the US. and the Arab world. U S. Mutable Mmufuchrar [:] In the U.S. the change in income shts the demand curve from D1 to D3 because the income elasticity is negative. C] In the U.S. the change in income shts the demand curve from 01 to D3 because the income elasticity is positive. [:] In the Arab makert the change in income shts the demand curve from D1 to D4 because the income elasticity is negative. C] In the Arab makert the change in income shts the demand curve from D1 to D4 because the income elasticity is positive. [:] In the U.S. the change in income shts the demand curve from 01 to D2 because the income elasticity is negative. C] In the U.S. the change in income shts the demand curve from D1 to D2 because the income elasticity is positive. C] In the Arab makert the change in income shts the demand curve from D1 to D5 because the income elasticity is negative. C] In the Arab makert the change in income shts the demand curve from D1 to D5 because the income elasticity is positive. [:] The change in income doesn't affect demand for automobiles