Question
Courtney's income is reduced from $1000per month to $800per month.As a result,her demand for frozen dinners increases from 2to 5per month.Louise's income rises from $1000
Courtney's income is reduced from $1000per month to $800per month.As a result,her demand for frozen dinners increases from 2to 5per month.Louise's income rises from $1000 to $1300 per month. As a result, her demand for pizza slices increases from 3 per month to 6 per month.
Questions:
(a) Calculate Courtney's income elasticity for frozen dinners. Please show your work...(3 marks)
(b) Calculate Louise's income elasticity for pizza slices. Please show your work......(3 marks)
(c) What is the between Courtney's attitude toward frozen dinners and Louise's attitude toward pizza? Use your answers above to explain...(3 marks
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