Boom Time For "Gently Used" Clothes Most retailers are blaming the economy for their poor sales, but one store chain that sells used name-brand children's clothes, toys, and furniture is boldly declaring that an economic downturn can actually be a boon for its business. Last year, the company took in $20 million in sales, up 5% from the previous year. Sales are already up 5% this year. Sources: CNN, April 17, 2008 20. a. According to news clip, is used clothing a normal good or an inferior good? b. If the price of used clothing falls and income remains the same, explain how the quantity of used clothing bought changes. c. If the price of used clothing falls and income, remains the same, describe the substitution effect and the income effect that occur.
19. Canadians' New Focus on Thrift
Canadian shoppers' shift to greater thriftiness has been unkind to retailers like Bikini Village and Le Chateau, which recently posted losses, but it may be a boon for budget stores like Dollarama Inc., which recently generated double-digit sales.
Source: The Financial Post, July 3, 2011
Draw a graph to show the effect of increased thriftiness on sales at (i) Bikini Village and (ii0 Dollarama.
Use the following information to work Problems 20 and 21.
Boom Time For "Gently Used" Clothes Most retailers are blaming the economy for their poor sales, but one store chain that sells used name-brand children's clothes, toys, and furniture is boldly declaring that an economic downturn can actually be a boon for its business. Last year, the company took in $20 million in sales, up 5% from the previous year. Sales are already up 5% this year.
Sources: CNN, April 17, 2008
20. a. According to news clip, is used clothing a normal good or an inferior good?
b. If the
c. If the price of used clothing falls and income, remains the same, describe the substitution effect and the income effect that occur.
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