Which of the following statements is/are true about inferior good? It is a good whose demand curve shifts leftward when the income of buyers increase and rightward when the income of buyers decrease. It is a good whose demand curve shifts rightward when the income of buyers increas and leftward when the income of buyers decrease. It is a good whose demand curve shifts leftward when the income of sellers increase and rightward when the income oAsellers decrease.
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- Suppose that Paolo and Sharon are the only consumers of ice cream cones in a particular market. The following table shows their monthly demand schedules: Price Paolo’s Quantity Demanded Sharon’s Quantity Demanded (Dollars per cone) (Cones) (Cones) 1 8 16 2 5 12 3 3 8 4 1 6 5 0 4 On the following graph, plot Paolo’s demand for ice cream cones using the green points (triangle symbol). Next, plot Sharon’s demand for ice cream cones using the purple points (diamond symbol). Finally, plot the market demand for ice cream cones using the blue points (circle symbol). Note: Line segments will automatically connect the points. Remember to plot from left to right.What is the relationship between price elasticity and position on the demand curve? For example, as youmove up the demand curve to higher prices and lower quantities, what happens to the measured elasticity? How would you explain that? Income effects depend on the income elasticity of demand for each good that you buy. If one of the goods you buy has a negative income elasticity, that is, it is an inferior good, what must be true of the income elasticity of the other good you buy?What is the relationship between price elasticity and position on the demand curve? For example, as youmove up the demand curve to higher prices and lower quantities, what happens to the measured elasticity? How would you explain that? Income effects depend on the income elasticity of demand for each good that you buy. If one of the goods you buy has a negative income elasticity, that is, it is an inferior good, what must be true of the income elasticity of the other good you buy? Needs explanation
- If X has many close substitutes, there will be large substitution effects (what will theindifference curves look like?). -The demand curve is likely to be flat, with a small increase in price leading to a large decrease in demand.For a normal good, the IE reinforces the SE, causing demand to be flatter. -For an inferiorgood, the IE dampens the SE, leading to a steeper demand curve. Can someone graph the Demand curve for a normal good and an inferior I'm having a hard time visualizing this. Thanks Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.Arya only consumes two goods: X and Y. When the price of X changes, the income effect and the substitution effect for X move in opposite directions. In addition, the income effect for X dominates the substitution effect. X must be: a) a Giffen good for Arya. b) an inferior good for Arya. c) a normal good for Arya. O d) perfect substitutes for Arya. O e) Both a and b are true.Let be following table of marginal utility data that you have been able to calculate for two goods that your company sells, at rate: Quantity X1 Marginal Utility X1 Quantity X2 Marginal Utility X2 1 600 1 140 2 580 2 130 3 560 3 120 4 540 4 100 5 520 5 80 6 500 6 60 Suppose that a government campaign has been initiated and negatively affects good X1, such that marginal utility of good X1 is estimated to decrease by 40 for each unit of this good.Given above, if prices of goods are p1= 20, p2= 5 and Total Revenue is 115, then:(a) What quantities of goods allow consumer to achieve maximum utility? Graphb) If, to compensate for negative campaign, company carries out a more aggressive advertising with good X2 such that, marginal utility of each good improves by 20 for each unit; and also company gives a voucher for $5 to each consumer, then, what would be quantities of X1 and X2 that maximizes consumer's utility? Graph
- For normal goodsA) the substitution effect of a price decrease will decrease the quantity of the good demanded while theincome effect of a price decrease will increase the quantity of the good demanded.B) the substitution and income effects of a price decrease will both increase the quantity of the gooddemanded.C) the substitution and income effects of a price decrease will both decrease the quantity of the gooddemanded.D) the substitution effect of a price decrease will increase the quantity of the good demanded while theincome effect of a price decrease will decrease the quantity of the good demanded.Draw the following scenario: Muhammad's percelves canned tuna (Y) as an inferior good and fresh tuna (X) as a normal good. If his income Increases by 100%, and his Income elasticity of both types of tuna is 1. Show the effect of this increase in income on the change in his optimal choice of canned and fresh tuna, highlighting his income-consumption curve. Clearly label your graph. Reflect the proportional changes in your graph. The graph may be something like thatSuppose X and Y are substitutes. If the price of Y increases, the demand for X will most likely _______, and the quantity demanded of X will also _______. 1) increase, increase 2) increase, decrease 3) decrease, increase 4) decrease, decrease 5) None of the above. Q19 Suppose X is a normal good. If the income increases, the demand for X will ______. 1) increase 2) decrease 3) stay the same
- 1. A) When it comes to the level of utility that can be attained along an individual demand curve, which of the following is true? Group of answer choices a-the level of utility increases as the price of the product falls b-the level of utility decreases as the price of the product falls c-the level of utility increases as the price of the product rises d-the level of utility stays constant always B) From a price-consumption curve, we can obtain: Group of answer choices a-points required to demonstrate a shift in a demand curve b-points required to create a downward sloping market demand curve c-points required to construct a downward sloping demand curve d-an income-consumption curve. C) Which of the following claims is true at each point along a price-consumption curve? Group of answer choices a-Utility is maximized, and all income is spent. b-Utility is maximized but income is not all spent. c-The level of utility is constant. d-All income is spent, but utility…Consider some determinants of the price elasticity of demand: • The availability of close substitutes • Whether the good is a necessity or a luxury • How broadly you define the market • The time horizon being considered A good with many close substitutes is likely to have relatively demand, since consumers can easily choose to purchase one of the close substitutes if the price of the good rises. A good's price elasticity of demand depends in part on how necessary it is relative to other goods. If the following goods are priced approximately the same, which one has the most elastic demand? O Sports car O Amputation procedures for diabetes sufferers The price elasticity of demand for a good also depends on how you define the good. Organize the goods found in the following table by indicating which is likely to have the most elastic demand, which is likely to have the least elastic demand, and which will have demand that falls in between.16.Suppose the market for a good is composed of 1,000 identical consumers. The market's demand curve is given by QM = 150,000 – 25P. What is the equation for an individual consumer's demand curve? A) Q = 150,000,000 – 25,000P B) Q = 6,000,000 – 40P C) Q = 6- 4P D) Q = 150 –0.025 17.There are 100 consumers in the market for good X. each with a demand curve given