Question
The price of a fish dinner is $4.When Harry's old income was $1,500 per month, his old monthly demand for fish dinners was Q =
The price of a fish dinner is $4.When Harry's old income was $1,500 per month, his old monthly demand for fish dinners was Q = 18 - 0.5P.When Harry got a pay raise and began to earn a new income of $2,000 per month, his demand shifted to a new function of Q = 21 - 0.5P.Given this information, find Harry's income elasticity (EI) for fish dinners.Harry's income elasticity is for fish dinner is .56
Consider your answer to the previous question.Based on the income elasticity you found, we can conclude that for Harry, fish dinner is considered _________________.
a normal good, and a luxury
a normal good, and a necessity
an inferior good
(The answer for the first question is Bold)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started