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e Homework (Ch 05) 6. Using the income elasticity of demand to characterize goods A survey taken by residents from the imaginary town of Draw City tells economists that the following changes result from an 11% rise in income: •A 34% increase in the quantity of jokers demanded ⚫A 16% decrease in the quantity of hearts demanded .A 12% increase in the quantity of chips 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.) Good Jokers Hearts Chips Income Elasticity of Demand Normal Good or Inferior Good 山 --> H Which of the following three goods is most likely to be classified as a luxury good? Hearts D

e Homework (Ch 05) 6. Using the income elasticity of demand to characterize goods A survey taken by residents from the imaginary town of Draw City tells economists that the following changes result from an 11% rise in income: •A 34% increase in the quantity of jokers demanded ⚫A 16% decrease in the quantity of hearts demanded .A 12% increase in the quantity of chips 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.) Good Jokers Hearts Chips Income Elasticity of Demand Normal Good or Inferior Good 山 --> H Which of the following three goods is most likely to be classified as a luxury good? Hearts D

Principles of Economics 2e
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter5: Elasticity
Section: Chapter Questions
Problem 31CTQ: Economists define normal goods as having a positive income elasticity. We can divide normal goods...
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e Homework (Ch 05) 6. Using the income elasticity of demand to characterize goods A survey taken by residents from the imaginary town of Draw City tells economists that the following changes result from an 11% rise in income: •A 34% increase in the quantity of jokers demanded ⚫A 16% decrease in the quantity of hearts demanded .A 12% increase in the quantity of chips 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.) Good Jokers Hearts Chips Income Elasticity of Demand Normal Good or Inferior Good 山 --> H Which of the following three goods is most likely to be classified as a luxury good? Hearts D
Transcribed Image Text:e Homework (Ch 05) 6. Using the income elasticity of demand to characterize goods A survey taken by residents from the imaginary town of Draw City tells economists that the following changes result from an 11% rise in income: •A 34% increase in the quantity of jokers demanded ⚫A 16% decrease in the quantity of hearts demanded .A 12% increase in the quantity of chips 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.) Good Jokers Hearts Chips Income Elasticity of Demand Normal Good or Inferior Good 山 --> H Which of the following three goods is most likely to be classified as a luxury good? Hearts D
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