Macroeconomics 1st Edition by Dean Karlan,Jonathan Morduch

Exercise 12

Suppose that when the average family income rises from $30,000 per year to $40,000 per year, the average family's purchases of toilet paper rise from 100 rolls to 105 rolls per year.
a. Calculate the income-elasticity of demand for toilet paper.
b. Is toilet paper a normal or an inferior good?
c. Is the demand for toilet paper income-elastic or income-inelastic?