= 0.8_I= -0.2_xy1= 0.6_xy2= -0.4

is the price elasticity of demand for Starbucks sausage sandwich, and _Iis the income elasticity of Starbucks sausage sandwich, _xy1is the cross elasticity of demand between Starbucks sausage sandwich and Subway tuna sandwich, _xy2is the cross elasticity of demand between Starbucks sausage sandwich and Starbucks Americanos coffee.

a. If you want to increase your sales of sausage sandwich by 20%, in what direction and by how much do you need to change the price?

b. If you make the percentage price change that you calculated in part a) will total revenue increase or decrease?How do you know?

c. Subway increases its price of tuna sandwich by 10%.The demand for Starbucks sausage sandwich will change by what percentage and in what direction?

d. Starbucks lowers the price of its Americano coffee by 8%. The demand for Starbucks sausage sandwich will change by what percentage and in what direction?

e. If average income decreases by7% by what percentage and in what direction will the demand for Starbucks sausage sandwich change? Is Starbucks sausage sandwich a normal good or an inferior good and how do you know?