If a Good Has an Income Elasticity of Demand Greater

question 112

Multiple Choice

If a good has an income elasticity of demand greater than 1,one might classify that good as

• A) a necessity.
• B) a luxury.
• C) unusual.
• D) inelastic.

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Definitions:

Laboratory Observation

The process of watching subjects in a controlled environment to gather data or test hypotheses.

Hypothesis

A tentative explanation or prediction that can be tested through scientific research.

Negative Correlation

A relationship between two variables in which one variable increases as the other decreases.

Correlation Coefficient

A statistical measure that indicates the extent to which two variables fluctuate together, showing the strength and direction of their relationship.