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Income Rises from $3,500 to $4,000 a Month and the Quantity

Question 118

Multiple Choice

Income rises from $3,500 to $4,000 a month and the quantity demanded of good X falls from 7 to 5 units a month. Income elasticity of demand (for good X) is __________ and good X is a(n) __________ good.


A) -2.50; inferior
B) 0.40; normal
C) -2.28; inferior
D) 2.50; normal

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