6. When countries experience a rise in income over time which of the following sectoral changes is most likely to occur? A The car manufacturing sector's output as a % of GDP will decrease B. The tourism sector's output as a % of GDP will increase C. The consumer electronics sector's output as a % of GDP will decrease D. The agricultural sector's output as a % of GDP will increase 7. The demand for coffee from a local coffee shop has an income elasticity of +0.6. After an 8% rise in average incomes the demand for the coffee sold by the coffee shop is expected to: A. Increase by 4.8% B. Decrease by 4.8% C. Increases by 13.3% D. Decrease by 13.3% 8. The diagram shows the market for second-hand cars in a recession when real incomes are falling. From the information in the diagram the most likely conclusion that can be made is: A. The price of new cars has fallen B. The price of second-hand cars has fallen C. The YED of second-hand cars is negative D. Second-hand cars are normal goods 9. Which of the following best describes an inferior good? A. A good that is only bought by low-income families B. A good for where demand falls as income rises C. A good that is very low quality D. A good with a YED of less than 1 10. It is estimated that apple juice has an income elasticity of demand of 0.2. Based on this information, which of the following is most likely to be true? A. Apple juice accounts for a small proportion of household expenditure B. Apple juice has few close substitutes C. Apple juice is a necessity good D. Apple juice is an inferior good
6. When countries experience a rise in income over time which of the following sectoral changes is most likely to occur? A The car manufacturing sector's output as a % of GDP will decrease B. The tourism sector's output as a % of GDP will increase C. The consumer electronics sector's output as a % of GDP will decrease D. The agricultural sector's output as a % of GDP will increase 7. The demand for coffee from a local coffee shop has an income elasticity of +0.6. After an 8% rise in average incomes the demand for the coffee sold by the coffee shop is expected to: A. Increase by 4.8% B. Decrease by 4.8% C. Increases by 13.3% D. Decrease by 13.3% 8. The diagram shows the market for second-hand cars in a recession when real incomes are falling. From the information in the diagram the most likely conclusion that can be made is: A. The price of new cars has fallen B. The price of second-hand cars has fallen C. The YED of second-hand cars is negative D. Second-hand cars are normal goods 9. Which of the following best describes an inferior good? A. A good that is only bought by low-income families B. A good for where demand falls as income rises C. A good that is very low quality D. A good with a YED of less than 1 10. It is estimated that apple juice has an income elasticity of demand of 0.2. Based on this information, which of the following is most likely to be true? A. Apple juice accounts for a small proportion of household expenditure B. Apple juice has few close substitutes C. Apple juice is a necessity good D. Apple juice is an inferior good
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
Transcribed Image Text:8. When countries experience a rise in income over time which of the following
sectoral changes is most likely to occur?
A. The car manufacturing sector's output as a % of GDP will
decrease
B. The tourism sector's output as a % of GDP will increase
C. The consumer electronics sector's output as a % of GDP will
decrease
D. The agricultural sector's output as a % of GDP will increase
7. The demand for coffee from a local coffee shop has an income elasticity of
+0.6. After an 8% rise in average incomes the demand for the coffee sold by
the coffee shop is expected to:
A. Increase by 4.8%
Decrease by 4.8%
B.
C. Increases by 13.3%
D. Decrease by 13.3%
8. The diagram shows the market for second-hand cars in a recession when
real incomes are falling.
From the information in the diagram the most likely conclusion that can be
made is:
A. The price of new cars has fallen
B. The price of second-hand cars has fallen
C. The YED of second-hand cars is negative
D. Second-hand cars are normal goods
9. Which of the following best describes an inferior good?
A. A good that is only bought by low-income families
B. A good for where demand falls as income rises
C. A good that is very low quality
D. A good with a YED of less than 1
10. It is estimated that apple juice has an income elasticity of demand of 0.2.
Based on this information, which of the following is most likely to be true?
A. Apple juice accounts for a small proportion of household
expenditure
B. Apple juice has few close substitutes
C. Apple juice is a necessity good
D. Apple juice is an inferior good
D
MA
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 5 steps
Recommended textbooks for you
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (12th Edition)
Economics
ISBN:
9780134078779
Author:
Karl E. Case, Ray C. Fair, Sharon E. Oster
Publisher:
PEARSON
Engineering Economy (17th Edition)
Economics
ISBN:
9780134870069
Author:
William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Publisher:
PEARSON
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics & Business Strategy (Mcgraw-…
Economics
ISBN:
9781259290619
Author:
Michael Baye, Jeff Prince
Publisher:
McGraw-Hill Education