If a 10 Percent Increase in Income Results in a 10

question 181

Multiple Choice

If a 10 percent increase in income results in a 10 percent decrease in the consumption of widgets, then

• A)the price elasticity of demand for widgets equals 1.
• B)the income elasticity of demand for widgets is negative.
• C)the income elasticity of demand for widgets equals 1.
• D)widgets are a normal good.
• E)the price elasticity demand for widgets is negative.

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Definitions:

CCA Class

A categorization under Canadian tax law that groups depreciable assets affecting the rate at which businesses can claim capital cost allowance for tax purposes.

Tourism Revenue

The income generated from tourists, including spending on accommodations, food, transport, and entertainment in the destination.

CCA Tax Shield

A tax deduction that allows businesses to depreciate the cost of tangible property or assets over time, reducing taxable income.