Suppose good X has a positive income elasticity of demand. This implies that good X could be (i) a normal good. (ii) a necessity. (iii) an inferior good. (iv) a luxury
a. (i) only
b. (i) and (ii) only
c. (i), (ii), and (iv) only
d. (iii) only
c
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The long-run aggregate supply curve (LRAS) is represented by a ________ curve with respect to the CPI
a. horizontal b. upward-sloping c. downward-sloping d. vertical
That part of national income not spent on consumption is defined as
a. transitory income b. permanent income c. disposable income d. autonomous consumption e. saving
Economists make assumptions in order to
a. mimic the methodologies employed by other scientists. b. minimize the number of experiments that yield no useful data. c. minimize the likelihood that some aspect of the problem at hand is being overlooked. d. focus their thinking on the essence of the problem at hand.
An increase in the money wage rate will cause the aggregate supply curve to shift
A. outward, which means the quantity supplied at any price level decreases. B. outward, which means the quantity supplied at any price level increases. C. inward, which means the quantity supplied at any price level increases. D. inward, which means the quantity supplied at any price level decreases.