Question

In much of the country, homeowners choose to heat their houses with either natural gas or heating oil. Which of the following would cause an increase in the demand for natural gas? O an increase in the price of natural gas
1. a decrease in the price of natural gas
2. a decrease in the price of heating oil
3. an increase in consumer incomes
4. a decrease in the price of heating oil

Answer 1

Answer:

1. a decrease in the price of natural gas

Explanation:

Given that homeowners choose to heat their houses with either natural gas or heating oil. It means that natural gas and heating oil are substitute products.

If there will be an increase in the demand for natural gas, there will invariably be a decrease in demand for heating oil.

From the options given, a decrease in the price of natural gas will result in and increase in it's demand.