Homework Answers
Option A.
- The income elasticity of demand refers to the changes in the demand with respect to changes in the income.
- From the income elasticity of demand, we can infer whether a good is a necessity or a luxury good.
- If the income elasticity of demand is positive and less than one, then we can say that the good is a necessity and if it is greater than one, it is a luxury.
- Here, it is given that the income elasticity of demand is 0.8 which is less than 1, hence the commodity is a necessity good.
Add Answer to:
Question 19 0.25 pts 19. If a commodity's income elasticity of demand is 0.82, then we...
QUESTION 10 The price elasticity of demand for gasoline is -0.25. If we expect the price...
QUESTION 10 The price elasticity of demand for gasoline is -0.25. If we expect the price of gasoline to increase by 8 percent, what is the expected change in the quantity of gasoline demanded? A. Quantity declines by 2 percent B. Quantity declines by 8 percent C. Quantity increases by 2 percent D. Quantity declines by 4 percent QUESTION 11 The income elasticity of demand for bananas is -0.1. Is this good normal or inferior? A. Normal B. Neither normal...
Income Elasticity of Demand Normal Or Inferior Good Clubs (-1.22, -0.82, 0.82, 1.22) (Normal, Inferior) Chips...
Income Elasticity of Demand Normal Or Inferior Good
Clubs (-1.22, -0.82, 0.82, 1.22) (Normal, Inferior)
Chips (-1.1, -0.91, 0.91, 1.1) (Normal, Inferior)
Diamonds (-2.73, -0.37, 0.37, 2.73) (Normal, Inferior)
Data collected from the economy of Cardtown reveals that an 11% decrease in income leads to the following changes: • A 9% increase in the quantity of clubs demanded • A 10% decrease in the quantity of chips demanded • A 30% decrease in the quantity of diamonds demanded Compute the...
Which formula is used for this question, point income elasticity or arc income elasticity? B. Calculate the income elas...
Which formula is used for this question, point income elasticity
or arc income elasticity?
B. Calculate the income elasticity of demand for a consumer who increases the consumption of commodity X from 100 units to 300 units per year when the income of the consumer increases from $16,000 to $20,000 per year. Is commodity X normal or inferior? Necessity or luxury?
The absolute value of the price elasticity of demand for telescopes is 1.5. Therefore, telescopes can be classif...
The absolute value of the price elasticity of demand for telescopes is 1.5. Therefore, telescopes can be classified as a luxury. True False of the following, which is the best example of good with a perfectly inelastic demand? the demand for a college education by a student who has a full scholarship to an Ivy League school a diabetic's demand for insulin the demand for gasoline the demand for tickets in New York City when the Mets or Yankees are...
Question 9 Which of the following statements is true? The demand curve for a necessity is...
Question 9 Which of the following statements is true? The demand curve for a necessity is more elastic than the demand curve for a luxury. The more time that passes the more inelastic the demand for a product becomes. The more narrowly we define a market, the more elastic the demand for a product will be. In general, if a product has few substitutes it will have an elastic demand. OOOO Question 10 The income elasticity of demand measures the...
Suppose that the price elasticity of demand of a good is -3. Its demand is _________...
Suppose that the price elasticity of demand of a good is -3. Its demand is _________ and the percentage change in its quantity demanded is ________ than the percentage change in its price. A. Elastic: Smaller B. Elastic: Greater C. Inelastic: Smaller D. Inelastic: Greater Which of the following is not a determinant of the price elasticity of demand? A. Availability of substitutes B. Degree of necessity C. Cost relative to income D. Availability of inputs With a(n) ______ demand,...
Question 15 If Incomes have risen by 20% and Demand for hand sanitizer has increased by...
Question 15 If Incomes have risen by 20% and Demand for hand sanitizer has increased by 5% explain the income elasticity of demand coefficient for hand sanitizer. Marked out of 1.00 Flag question Select one: O a. = -0.25 Inferior O b. = 4 luxury, Income elastic C. = 0.25 necessity, income inelastic O d. = -4 income inelastic, luxury
If the income elasticity of demand for a good is -1.5 that good is A. A...
If the income elasticity of demand for a good is -1.5 that good is A. A substitute to another good. B. A complement to another good. C. A normal good. D. An inferior good. E. A necessity good.
Income elasticity of demand Calculate the income elasticity of demand for the following demand functions and...
Income elasticity of demand Calculate the income elasticity of demand for the following demand functions and assess its magnitude (is the good normal, inferior, a luxury or a necessity?). Q =50 -10p + 3Y, at p = 2 and Y = 20 Q = 5 - 20p + 4Y, at p = 1 and Y = 50 Q = 70 – 3p – 2Y, at p = 15 and Y = 5 Q = 35 - 20p + 0.5Y, at...
If demand for pork is given by: QD = 200 – 6P + 2Y, when the...
If demand for pork is given by: QD = 200 – 6P + 2Y, when the price of pork is £8, a rise inconsumers’ income from £100 to £150 leads to: a) a fall in demand and an income elasticity of -0.14, pork is an inferior good b) a rise in demand and an income elasticity of 0.14, pork is a normal good and a necessity c) a rise in demand and an income elasticity of 7.08, pork is a...
Income Elasticity of Demand Normal Or Inferior Good
Clubs (-1.22, -0.82, 0.82, 1.22) (Normal, Inferior)
Chips (-1.1, -0.91, 0.91, 1.1) (Normal, Inferior)
Diamonds (-2.73, -0.37, 0.37, 2.73) (Normal, Inferior)
Data collected from the economy of Cardtown reveals that an 11% decrease in income leads to the following changes: • A 9% increase in the quantity of clubs demanded • A 10% decrease in the quantity of chips demanded • A 30% decrease in the quantity of diamonds demanded Compute the...
Which formula is used for this question, point income elasticity
or arc income elasticity?
B. Calculate the income elasticity of demand for a consumer who increases the consumption of commodity X from 100 units to 300 units per year when the income of the consumer increases from $16,000 to $20,000 per year. Is commodity X normal or inferior? Necessity or luxury?
The absolute value of the price elasticity of demand for telescopes is 1.5. Therefore, telescopes can be classified as a luxury. True False of the following, which is the best example of good with a perfectly inelastic demand? the demand for a college education by a student who has a full scholarship to an Ivy League school a diabetic's demand for insulin the demand for gasoline the demand for tickets in New York City when the Mets or Yankees are...
Question 9 Which of the following statements is true? The demand curve for a necessity is more elastic than the demand curve for a luxury. The more time that passes the more inelastic the demand for a product becomes. The more narrowly we define a market, the more elastic the demand for a product will be. In general, if a product has few substitutes it will have an elastic demand. OOOO Question 10 The income elasticity of demand measures the...
Question 15 If Incomes have risen by 20% and Demand for hand sanitizer has increased by 5% explain the income elasticity of demand coefficient for hand sanitizer. Marked out of 1.00 Flag question Select one: O a. = -0.25 Inferior O b. = 4 luxury, Income elastic C. = 0.25 necessity, income inelastic O d. = -4 income inelastic, luxury
Most questions answered within 3 hours.
-
What could be a possible reason that protozoan infections are
increasing in the United States
asked 4 minutes ago -
Assume a class has 19 members.
a. In how many ways can a president, a vice...
asked 6 minutes ago -
Implement a Full Adder with two 4x1 Mux and the MSB as possible
inputs of the...
asked 14 minutes ago -
offering the survey (maybe via smart phones) is a good idea?
why?
asked 11 minutes ago -
Claim: At most 81% of adults do not have hypertension. When 869
randomly selected adults were...
asked 8 minutes ago -
2. Construct a business plan for your proposed business in
question 1, paying particular attention to:...
asked 8 minutes ago -
1. Choose a work situation in which you were required to do a
lot of creative...
asked 15 minutes ago -
An aqueous solution of barium hydroxide is
standardized by titration with a 0.196 M solution
of...
asked 55 minutes ago -
accorsing to the data from thw college board, the mean wuantitive
Sat score for s demale...
asked 1 hour ago -
1- What are 5 general characteristics of Botticelli’s
paintings?
2- Describe 5 important traits of Flemish...
asked 3 hours ago -
A golfer claims that his average golf score at the course he
plays regularly is less...
asked 4 hours ago -
On May 1, First Bank perfected a security interest in Debtor’s
inventory. On June 1, Bob...
asked 4 hours ago