A survey taken by residents from the imaginary town of Cardsburgh tells economists that the following changes result from a 10% fall in income: • An 8% decrease in the quantity of tokens demanded • A 15% increase in the quantity of kings demanded • A 38% decrease in the quantity of clubs demanded Compute the income elasticity of demand for each good and use the dropdown menus to complete the first column in the following table. Then, based

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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Homework (Ch 05)
A survey taken by residents from the imaginary town of Cardsburgh tells economists that the following changes result from a 10% fall in income:
• An 8% decrease in the quantity of tokens demanded
• A 15% increase in the quantity of kings demanded
• A 38% decrease in the quantity of clubs demanded
Compute the income elasticity of demand for each good and use the dropdown menus to complete the first column in the following table. Then, based
on the income elasticities, classify each good as either a normal good or an inferior good. (Hint: Be careful to keep track of the direction of change.
The sign of the income elasticity of demand can be positive or negative, and the sign gives important information.)
Income Elasticity of Demand Normal Good or Inferior Good
Good
Tokens
Kings
Clubs
Which of the following three goods is most likely to be classified as a luxury good ?
Type here to search
O Kings
O Tokens
O Clubs
]0[
+
a
49
Р
O
DOW
12:56 PM
10/2/2023
X
:
Transcribed Image Text:e MindTap - Cengage Learning X + and Study Tools ptions Success Tips Cuccess Tips -dback ✰ng.cengage.com/static/nb/ui/evo/index.html?elSBN=9780357133606&id=1834966624&snapshotld=3545333& Homework (Ch 05) A survey taken by residents from the imaginary town of Cardsburgh tells economists that the following changes result from a 10% fall in income: • An 8% decrease in the quantity of tokens demanded • A 15% increase in the quantity of kings demanded • A 38% decrease in the quantity of clubs demanded Compute the income elasticity of demand for each good and use the dropdown menus to complete the first column in the following table. Then, based on the income elasticities, classify each good as either a normal good or an inferior good. (Hint: Be careful to keep track of the direction of change. The sign of the income elasticity of demand can be positive or negative, and the sign gives important information.) Income Elasticity of Demand Normal Good or Inferior Good Good Tokens Kings Clubs Which of the following three goods is most likely to be classified as a luxury good ? Type here to search O Kings O Tokens O Clubs ]0[ + a 49 Р O DOW 12:56 PM 10/2/2023 X :
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