Final answer:
If incomes decrease, the demand curve for public buses would shift left, representing a decrease in demand at all price levels, similar to how demand for other goods like cars might fall during an economic downturn.
Step-by-step explanation:
If people's income decreased, the demand curve for public buses would shift left. This leftward shift indicates a decrease in demand, which means at every price level, there is a lower quantity demanded. This scenario is comparable to when the economy slows down and many people lose their jobs or work fewer hours, leading to a decrease in income and thus a diminished demand for goods like cars. As a result, the original demand curve (D0) shifts to the left (D2). For example, if the price is set at $20,000, the number of cars sold would decrease from 18 million to 14.4 million after the shift.
Moreover, this is linked to the concept of cyclical unemployment, which is the variation in employment caused by the economic business cycle. During a slowdown or recession, the demand for labor also decreases, shifting the labor demand curve to the left.