Read Case Study: General Motors Indonesia Shifts Attention to SUVs

Entry Sports Utility Vehicles (SUVs) are quickly gaining popularity
among Indonesian vehicle buyers, with owners spending an median of 21
months of their household income to purchase a vehicle in this highly
aspirational segment, compared with 18 months for the rest of the
market, according to the J.D. Power 2016 Indonesia Sales Satisfaction
Index (SSI).

As a market analyst for GM, you are to advise the management on the following scenarios, ceteris paribus:

Scenario 1: The selling price of an SUV rises.

Scenario 2: There is a massive discount on the price of a van. Scenario
3: Consumers expect the price of an SUV will fall next year.

Scenario 4: A breakthrough automation technology help to lower the cost of producing SUVs.

In your explanation, you are to cover the following:

• How does each influence affect the quantity supplied or the supply of SUVs.

• Draw the effects of each event by either a movement along the supply curve or a shift in the supply curve.
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