Amisha's Engel Curve for Potato Chips Is I = 300C

question 90

Multiple Choice

Amisha's Engel curve for potato chips is I = 300C, where I is weekly income and C measures the number of bags of potato chips. Amisha considers potato chips a(n) :

• A) inferior good.
• B) normal good.
• C) inferior good at income levels above $60,000.
• D) inferior good at income levels above $30,000.

---

Definitions:

Marginal Cost

The cost of producing one more unit of a good or service, which may change with the level of output.

Fixed Cost

Expenses that remain constant regardless of production or sales volume, including rent, salaries, and insurance.

Total Cost

The total of all costs associated with producing goods or services, encompassing both constant and fluctuating expenses.

Variable Cost

Variable cost is a cost that varies directly with the level of production or sales volume, such as materials and labor costs.