Question

Suppose an economic boom causes incomes to increase. Assume that smartphones are a normal good. This will cause the______________.A. supply of smart phones to increase; the price of smart phones would decrease and the quantity of smart phones traded would rise. B. supply of smart phones to decrease; the price of smart phones would increase and the quantity of smart phones traded would fall. C. demand for smart phones to decrease, and both the price of smart phones and the quantity of smart phones traded would fall. D. demand for smart phones to increase, and both the price of smart phones and the quantity of smart phones traded would rise.

Answer 1

Answer:

Answer is D

Explanation:

Answer 2

Answer: Option (D). demand for smartphones to increase, and both the price of smartphones and quantity of smartphones traded would rise.

Explanation: Economic boom is a period of economic expansion resulting in higher GDP, lower unemployment and rising asset prices. Economic boom positively affect the key economic indicators will rise. Gross domestic product, which measures a nation’s economic output increases and productivity increases in return. Economic boom will increase the demand for smartphones and will in turn increase both the price of smartphones and quantity of smartphones and quantity of smartphones traded would rise.