A product that has a negative income elasticity of demand is ________ good
A) a complementary
B) a substitute
C) a normal
D) an inferior
E) a negative
D
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If indifference curves and budget lines are used to analyze consumer choice, an inferior good will
A. escape detection when income rises. B. be easily identified because the quantity purchased will fall as income rises. C. be easily identified because the quantity purchased will rise as income rises. D. be easily identified because it will change the slope of the budget line. E. escape detection because this model does not show that relationship.
The burden of a site value tax will be borne entirely by the site owner _____
a. because the demand for land is elastic b. when the site owner is forced to remit the tax c. because the supply of land is completely inelastic d. when the supply of land is unitary elastic
What is a better pricing strategy for the monopolist? At this price, what are the total profits to the monopolist?
a. Bundle the goods at $2,800 . Profits=$5,600 b. Bundle the goods at $4,000 . Profits=$8,000 c. Charge $2,800 for good 1 and charge $1,700 for good 2; Profits=$4,500 d. Charging the lowest price for each good individually is the best pricing strategy; profits = $7,000
State and local governments spend more on the purchases of goods and services than the federal government
Indicate whether the statement is true or false