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4. Erin's income increases by 25%.As a result, her demand for cheesecakes increases by 15%. In addition, Erin's demand for jelly decreases by 10%. a.

4. Erin's income increases by 25%.As a result, her demand for cheesecakes increases by 15%. In addition, Erin's demand for jelly decreases by 10%.

a. What is Erin's income elasticity of demand for cheesecakes?

0.6

b. Interpret the income elasticity found in part a.

c. Are cheesecakes normal or inferior goods for Erin and why?

d. What is Erin's income elasticity of demand for jelly?

e. Interpret the income elasticity found in part d.

f. Is jelly a normal or an inferior good for Erin and why?

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