A Simple Linear Demand Function May Be Stated as Q

Multiple Choice

A simple linear demand function may be stated as Q = a - bP + cI where Q is quantity demanded, P is the product price, and I is consumer income. To compute an appropriate value for c, we can use observed values for Q and I and then set the estimated income elasticity of demand equal to:

A) c(I/Q) .
B) c(Q/I) .
C) -b(I/Q) .
D) Q/(cI) .