For which of the following goods is the income elasticity of demand likely to be largest?

For which of the following goods is the income elasticity of demand likely to be largest?
 a. paperback mystery stories
  b. best-selling hardcover novels
  c. used textbooks
  d. children's books
  e. leather-bound editions of Shakespeare

QUESTION 2

Goods with an income elasticity of demand greater than 1 are called
 a. necessities
  b. inferior goods
  c. normal goods
  d. luxuries
  e. complements

QUESTION 3

For which of the following goods is the value of income elasticity most likely to be negative?
 a. macaroni and cheese
  b. champagne
  c. airline tickets
  d. clothes
  e. toothpaste

QUESTION 4

Inferior goods have an income elasticity of demand that is
 a. positive
  b. negative
  c. 0
  d. greater than 1 in absolute value
  e. equal to 1 in absolute value

QUESTION 5

If income rises and the demand for a product remains unchanged, the income elasticity of demand for that product is unit elastic.
 a. True
  b. False

QUESTION 6

A normal good is defined as a product for which quantity demanded increases as price decreases.
 a. True
  b. False

QUESTION 7

Necessities and luxuries are both types of normal goods.
 a. True
  b. False

QUESTION 8

If income rises and the demand for toothbrushes stays the same, income elasticity of toothbrushes is said to be unit elastic.
 a. True
  b. False