|Question||Consider the market for hamburger, and draw representative supply and demand curves.
a. Assume that hamburger is an inferior good. Suppose that consumer incomes fall, and at the same time, an improvement in technology lowers production costs. Show this on your graph. If you have no other information, what can you say about the change in equilibrium price and quantity?
b. Now suppose that you have the additional information that the change in consumer incomes has been relatively small, while the reduction in production costs has been relatively large. How would this change your answer to (a)?