Table 5-5 The Following Table Shows a Portion of the Demand Schedule

question 492

Multiple Choice

Table 5-5
The following table shows a portion of the demand schedule for a particular good at various levels of income.

-Refer to Table 5-5.Using the midpoint method,at a price of $8,what is the income elasticity of demand when income rises from $7,500 to $10,000?

• A) 0.00
• B) 0.41
• C) 1.00
• D) 2.45

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Definitions:

Long-Term Bond

A bond with a maturity date extending beyond 10 years, offering higher yields to compensate for the increased risk associated with the longer duration.

Equity Investment

An investment in shares of a company, providing ownership interest to the investor.

Debt Investment

A type of investment where investors lend money to an entity (corporate or governmental) that borrows the funds for a defined period at a variable or fixed interest rate.

Semiannually

Occurring or happening twice a year; every six months.