Judy's Marshallian demand for oranges is [0.7 2p0.3p0.4 where Pa is the price of apples, po is the price of oranges, and I is Judy's income. Suppose I = 100, Pa = = 2, and po = 1. a) Find and interpret the income elasticity for the demand for oranges. Are oranges an 1 inferior or normal good? b) Find the own price elasticity of demand for oranges. Discuss how the price elasticity varies with po c) Find the cross price elasticity for oranges. Are oranges and apples gross substitutes or gross complements?

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