Consider the wind turbine market. In August, Denmark’s Vestas Wind Systems, the

Question

Consider the wind turbine market. In August, Denmark’s Vestas Wind Systems, the world’s largest manufacturer of wind turbines, announced that it would eliminate 3,700 jobs, bringing its total workforce down to about 19,000 by year-end. The company cited two reasons for implementing the layoffs: the continuing sluggishness in the world’s economies and the expiration of a U.S. tax credit on wind-power production. Both of these reasons contribute to a decrease in the incomes of customers looking to purchase wind turbines. In the market for wind turbines, the market price _____ and market quantity _____.

A. increases...increases

B. increases...decreases

C. decreases...increases

D. decreases...decreases

Explanation / Answer

D. decreases...decreases

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