All else equal, an increase in the price of bicycle helmets, would tend to:
A)reduce the demand for cars
B)increase the demand for bicycles
C)reduce the demand for bicycles
D)cause more riders to walk to work.

Question

Quizplus · Accepted Answer

An increase in the price of bicycle helmets would make it more expensive for people to own and ride bicycles, causing a shift in demand away from bicycles and towards alternative modes of transportation. This could potentially lead to a slight increase in demand for cars, but it is more likely that commuters would opt for walking or using public transportation instead. An increase in the price of bicycle helmets would increase the cost of cycling, which would likely reduce the demand for bicycles. This is because consumers may view cycling as less affordable or less attractive compared to alternatives. A and D are out of scope, as they do not directly relate to the price of bicycle helmets. B is incorrect, as an increase in the price of bicycle helmets may actually make bicycles less attractive compared to other modes of transportation.

All Else Equal, an Increase in the Price of Bicycle