Circle the correct option in each of the following items. 1. If there are many available substitutes for a decreased by 4%, your income elasticity for product, the demand for that product must be: those jeans is: a) Inelastic a) -0.8 and jeans are an inferior good b ) very elastic b) 0.8 and pants are a normal good c) perfectly inelastic c) -1.25 and it is an inferior good d) Elastic or inelastic, since the number d) 1.25 and is a normal good of substitutes available does not affect the elasticity of demand 6. If your income increases and the demand curve for a good you buy moves parallel to 2. If the income elasticity of demand for a the left, for your level of income it is a good: good is positive and less than one, it must be a good: a) Lower b) normal a) Lower Luxury b) normal d) Indifferent to changes in income C) Luxury d) substitute 7. If the income elasticity of good X is 1.5, then good X is: 3. If the income elasticity of demand for a good is negative, then it is a good: a) An inferior good b) A luxury good a) Lower c) A normal good b ) normal d) U good indifferent to income c) Luxury d) Indifferent to income B. If the income elasticity of a type of calculator is 0.2, a 5% increase in income will 4. If your income increases 10% and your cause: quantity of pizza demanded increases 5%, your income elasticity for pizza is: a) 0.04% increase in the quantity demanded of the calculators a ) -2 b) 25% decrease in the quantity of b) 0.5 calculators demanded c) 2 c) 1% decrease in the quantity of d) -0.5% calculators demanded d) 1% increase in the quantity of 5. If your income increased by 5% and your calculators demanded quantity demanded of a certain brand of jeans