Author Question: Consider the following data for a hypothetical economy.YearAverage Household Income ($)Price of ... (Read 21 times)

nods · **on:** Oct 12, 2022

Question 1

Consider the following data for a hypothetical economy.

Year	Average Household Income ($)	Price of Gasoline ($/litre)	Quantity Demanded of Gasoline (millions of litres)
2012	78 000	1.30	1940
2013	82 000	1.30	2060

TABLE 4-3

Refer to Table 4-3. The income elasticity of demand for gasoline in this economy is
◦ 8.3.
◦ 6.0.
◦ 0.6.
◦ 0.5.
◦ 1.2.

Question 2

Consider the following data for a hypothetical economy.

Year	Average Household Income ($)	Price of Transit Passes ($)	Quantity Demanded Transit Passes
2012	78 000	60	99 000
2013	82 000	60	101 000

TABLE 4-4

Refer to Table 4-4. The income elasticity of demand for transit passes in this economy is
◦ 0.5.
◦ 2.5%.
◦ 0.4.
◦ 3.0%.
◦ 2.5.

knguyen · **Reply #1 on:** Oct 12, 2022

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