Assume That a 4 Percent Increase in Income Results in a 2

question 94

Multiple Choice

Assume that a 4 percent increase in income results in a 2 percent increase in the quantity demanded of a good. The income elasticity of demand for the good is

• A)negative, and the good is an inferior good.
• B)negative, and the good is a normal good.
• C)positive, and the good is a normal good.
• D)positive, and the good is an inferior good.

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Definitions:

Effect Size

The extent to which two variables are associated. In experimental research, the magnitude of the impact of the independent variable on the dependent variable.

Independent Variable

A variable that is manipulated or controlled in an experiment to observe its effect on a dependent variable.

Field Experiments

Research studies conducted in natural settings outside the laboratory to investigate the effect of manipulated variables in real-world situations.

Exact Replication

A type of replication of research using the same procedures for manipulating and measuring the variables that were used in the original research.