Question
Assume that you have two goods, good X and good Y, and that someone has determined the following information about these goods. Use this information
Assume that you have two goods, good X and good Y, and that someone has determined the following information about these goods. Use this information to answer the question below. i. If consumer income increases by 10%, then consumers buy 5% fewer units of good X ii. If consumer income increases by 10%, then consumers buy 8% more units of good Y iii. If the price of good X decreases by 4%, then consumers buy 5% more units of good X iv. If the price of good Y decreases by 1%, then consumers buy 4% more units of good Y v. If the price of good Y increases by 2%, then consumers buy 5% more units of good X
Based on the interpretation of point "i" (above), which of the following is a correct statement:
a. | good X is a normal good and a luxury good | |
b. | good X is a normal good and a necessity | |
c. | good X is an inferior good | |
d. | good X is an inelastic good | |
e. | none of the above are correct |
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