*4* Assume that when consumer income increases ten percent (+10%), the demand for grits increases five percent (+5%). The income elasticity of demand for good "X" is: O+2.0 and good "X" is a "normal good." +0.5 and good "X" is a "normal good." O +0.5" and the demand for good "X" is "relatively inelastic." O-0.5 and good "X" is an "inferior good." O+2.0" and the demand for good "X" is "relatively elastic."
*4* Assume that when consumer income increases ten percent (+10%), the demand for grits increases five percent (+5%). The income elasticity of demand for good "X" is: O+2.0 and good "X" is a "normal good." +0.5 and good "X" is a "normal good." O +0.5" and the demand for good "X" is "relatively inelastic." O-0.5 and good "X" is an "inferior good." O+2.0" and the demand for good "X" is "relatively elastic."
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Aa.13.
Account question......
![*4* Assume that when consumer income increases ten percent (+10%), the demand for grits increases five percent (+5%). The income elasticity of
demand for good "X" is:
O+2.0 and good "X" is a "normal good."
+0.5" and good "X" is a "normal good."
O"+0.5" and the demand for good "X" is "relatively inelastic."
O-0.5 and good "X" is an "inferior good."
O+2.0 and the demand for good "X" is "relatively elastic."](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8342b035-9205-4b5f-836c-08881ca83705%2F0e65554c-a2eb-4218-b72c-56fd4e0a4266%2Fjxw62pi_processed.jpeg&w=3840&q=75)
Transcribed Image Text:*4* Assume that when consumer income increases ten percent (+10%), the demand for grits increases five percent (+5%). The income elasticity of
demand for good "X" is:
O+2.0 and good "X" is a "normal good."
+0.5" and good "X" is a "normal good."
O"+0.5" and the demand for good "X" is "relatively inelastic."
O-0.5 and good "X" is an "inferior good."
O+2.0 and the demand for good "X" is "relatively elastic."
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