« previous next »

Author Question: Suppose a 4 percent increase in income results in a 2 percent decrease in the quantity demanded of a ... (Read 243 times)

abarnes

  • Hero Member
  • *****
  • Posts: 556
on: Jun 29, 2018
Suppose a 4 percent increase in income results in a 2 percent decrease in the quantity demanded of a good. Calculate the income elasticity of demand for the good and determine what type of good it is.
 
  What will be an ideal response?

Question 2

Adverse selection is a situation in which one party to an economic transaction has less information than the other party.
 
  Indicate whether the statement is true or false
InMicro ¦ Hubbard, O'Brien ¦ 1st Edition
Buy Test-Bank


scottmt

  • Sr. Member
  • ****
  • Posts: 322
Reply #1 on: Jun 29, 2018
Answer to Question 1

Income elasticity of demand = -0.5. The good is inferior.

Answer to Question 2

FALSE


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

Thyroid conditions may make getting pregnant impossible.

Did you know?

The Romans did not use numerals to indicate fractions but instead used words to indicate parts of a whole.

Did you know?

An identified risk factor for osteoporosis is the intake of excessive amounts of vitamin A. Dietary intake of approximately double the recommended daily amount of vitamin A, by women, has been shown to reduce bone mineral density and increase the chances for hip fractures compared with women who consumed the recommended daily amount (or less) of vitamin A.

Did you know?

Pubic lice (crabs) are usually spread through sexual contact. You cannot catch them by using a public toilet.

Did you know?

More than one-third of adult Americans are obese. Diseases that kill the largest number of people annually, such as heart disease, cancer, diabetes, stroke, and hypertension, can be attributed to diet.

(A) Scratch test; patient is exposed to allergens through a light scratch on the skin; (B) Positive (A) Scratch test; patient is exposed to allergens through a light scratch on the skin; (B) Positive
Sociologists use income, education, and occupational prestige to measure social class. For most ... Sociologists use income, education, and occupational prestige to measure social class. For most ...
The Gender Pay Gap Over Time: What Percentage of Men's Income Do Women Earn? The Gender Pay Gap Over Time: What Percentage of Men's Income Do Women Earn?
Blood types and results of donor and recipient combinations. Blood types and results of donor and recipient combinations.
How to solve any percent concentration problem How to solve any percent concentration problem
The immune response results from activation of the humoral and cell-mediated immune systems The immune response results from activation of the humoral and cell-mediated immune systems
Video: Nucleic acid digestion -small intestine

For a complete list of videos, visit our video library