You Are the Manager of a Supermarket, and Know That

Multiple Choice

You are the manager of a supermarket, and know that the income elasticity of peanut butter is exactly -0.7.Due to the recession, you expect incomes to drop by 15% next year.How should you adjust your purchase of peanut butter?

A) Buy 10.5% more peanut butter.
B) Buy 2.14% more peanut butter.
C) Buy 6.2% less peanut butter.
D) Buy 9.8% less peanut butter.