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Ifthere are two goods and if income doubles and the price of good 1doubles, while the price of good 2 stays constant: A. a consumer's
Ifthere are two goods and if income doubles and the price of good 1doubles, while the price of good 2 stays constant:
A. a consumer's demand for good 1 will increase only if it isa Giffen good for her.
B. a consumer's demand for good 1 will decrease only if it isan inferior good for her
C. a consumer's demand for good 2 will decrease only if it isa Giffen good for her.
D. a consumer's demand for good 2 will increase only if it isan inferior good for her.
E. None of the above
I wonder whether the answer is E, since there is no enoughevidence to prove Giffen good. Please show the steps, thankyou!
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