Suppose the demand curve for desktop computers shifts rightward and at the same

Question

Suppose the demand curve for desktop computers shifts rightward and at the same time the supply curve shifts leftward. Which of of the following could have caused these shifts?
a. The price of a laptop computer, a substitute for desktop computers, fell and the cost of producing desktop computer decreased.
b. Consumers purchased more computers because of the xmas season and the labor costs of producing desktop computers decreased.
c. Desktop computers are a normal good and incomes increased, while more firms entered the market.
d. Desktop computers are a normal good and incomes decreased, while the labor costs of producing personal computers increased.
e. Desktop computers are a normal good and incomes increased, while the labor costs of producing personal computers increased.

Explanation / Answer

So let's figure out what they mean: demand rightward = more demand supply leftward= less supply. a. well if a substitute is cheaper, then demand would go down. b. demand up, but supply would go up if labor costs decreased. c. more supply if more firms + prices go down with competition. d. incomes decrease=less demand e. Demand goes up if incomes increase, labor cost increase = less supply. E works.

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