Scenario 5.1 The Demand for Noodles Is Given by the Following Equation

Multiple Choice

Scenario 5.1
The demand for noodles is given by the following equation: Q = 20 - 4P + 0.2I - 2P_x. Assume that P = $8, I = 200, and P_x = $10.
-Which of the following statements correctly describe the elasticities of demand for gasoline and automobiles?

A) The income elasticity of demand for gasoline and automobiles is negative.
B) The price elasticity of demand for gasoline is elastic and the cross-price elasticity between gasoline and SUVs is positive.
C) The price elasticity of demand for gasoline is inelastic and the cross-price elasticity between gasoline and SUVs is negative.
D) The price elasticity of demand for gasoline is inelastic and the income elasticity between gasoline and SUVs is positive.
E) The price elasticity of demand for gasoline is elastic and the income elasticity between gasoline and SUVs is negative.