Author Question: Food and utilities are examples of income-inelastic products. Indicate whether the statement is ... (Read 57 times)

schs14 · **on:** Jul 7, 2018

Food and utilities are examples of income-inelastic products.

Indicate whether the statement is true or false

Question 2

If the income-elasticity coefficient for coffee is 0.5, the demand for coffee will ________.

A) decrease 0.5 percent for every 1.0 percent increase in income
B) increase 1.0 percent for every 5.0 percent increase in income
C) increase 0.5 percent for every 1.0 percent increase in income
D) decrease 0.5 percent for every 0.5 percent increase in income