Homework Help: economics

Posted by jones on Tuesday, November 17, 2009 at 10:28pm.

suppose the income elasticity of demand for toys is +2.00. this means that a. a 10 percent increase in income will increase the purchase of toys by 20 percent b. a 10 percent increase in income will increase the purchase of toys by 2 percent c. a 10 percent increase in income will decrease the purchase of toys by 2 percent d. toys are an inferior good.

economics - economyst, Wednesday, November 18, 2009 at 9:02am
Income (I) elasticity is (%change Q)/(% change I).
So, you have (%change Q)/(10%) = 2.0 So, (%change Q) must be......
economics - dfdef, Saturday, October 22, 2011 at 7:10pm
b

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