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Consider the market for home espresso machines (a normal good) at right. Suppose consumer income increases and the wage of espresso machine factory workers increases.
Consider the market for home espresso machines (a normal good) at right. Suppose consumer income increases and the wage of espresso machine factory workers increases. Part 2 Use the line drawing tool to show the effect of the above shocks on the market for espresso machines. Properly label any lines you draw. Part 3 Carefully follow the instructions above, and only draw the required objects. Part 4 Assuming the magnitude of the shifts is unknown, which of the following is true? Part 5 A. The equilibrium price will increase, but the effect on equilibrium quantity is unclear. B. The equilibrium quantity will increase, but the effect on equilibrium price is unclear. C. Both the equilibrium price and quantity will decrease. D. Both the equilibrium price and quantity will increase. E. None of the above are true
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