A decrease in the demand for recreational fishing boats might be caused by an increase in the:

• A. price of fishing licenses
• B. income of consumers
• C. price of recreational fishing boats
• D. popularity of fishing as a hobby

Answer: (A)

Verified step by step guidance

1. Step 1: Understand the concept of demand in microeconomics. Demand refers to the quantity of a good or service that consumers are willing and able to purchase at various prices, holding other factors constant.
2. Step 2: Identify factors that can cause a shift in the demand curve. These include changes in consumer income, prices of related goods, consumer preferences, and expectations.
3. Step 3: Analyze each option to see how it affects demand for recreational fishing boats: an increase in the price of fishing licenses (a complementary good), an increase in consumer income (normal or inferior good effect), an increase in the price of the boats themselves (movement along the demand curve), and a change in popularity (consumer preferences).
4. Step 4: Recognize that an increase in the price of fishing licenses, which are complementary to fishing boats, would make fishing more expensive overall, thus reducing the demand for fishing boats (shift demand curve left).
5. Step 5: Conclude that an increase in the price of recreational fishing boats causes a movement along the demand curve (not a shift), while an increase in income or popularity would likely increase demand, not decrease it.