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Question: Used cars were difficult to find on sale during much of the COVID-19 pandemic because many more consumers than usual tried to buy used
Question: Used cars were difficult to find on sale during much of the COVID-19 pandemic because many more consumers than usual tried to buy used cars. Which of the following may explain the increase in the quantity demanded of used cars? Do not worry about the underlying facts of each statement, only whether it makes economic sense given our model. (Select one or more answers from below)
(a) Incomes fell during the pandemic, and used cars are a luxury good. (b) Incomes fell during the pandemic, and used cars are a necessity good. (c) Incomes fell during the pandemic, and used cars are an inferior good. (d) The price of new cars rose, and used cars are a substitute for new cars. (e) The price of new cars fell, and used cars are a substitute for new cars. (f) The price of used cars rose and demand follows the law of demand. (g) The price of used cars rose and demand follows the law of compensated demand. (h) Consumers developed a stronger preference for travel by car relative to public transit. (i) Consumers developed a stronger preference for public transit relative to travel by car. (j) Consumer preference is unrelated to product demand.
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