Suppose National Income Is Rising Steadily at 2% Per Year

question 140

Multiple Choice

Suppose national income is rising steadily at 2% per year over a 5-year period.Over the same time period,suppose quantity demanded for iPods and iPhones increases at 5% per year,but no other relevant variables are changing.We can conclude that the income elasticity for these products is ________ and that these products are ________ goods.

• A)0.4; inferior
• B)4.0; normal
• C)2.5; luxury
• D)10.0; necessities
• E)4.0; necessities

---

Definitions:

Tangible

describes physical objects that can be seen, touched, and measured, as opposed to intangible items like services or digital products.

Time Utility

The value added to products or services by making them available at the most opportune time.

Digital Marketspace

An online platform or environment where businesses and consumers can interact and conduct transactions electronically.

Recreational Equipment, Inc.

An American retail and outdoor recreation services corporation, often referred to by its abbreviation, REI.