Suppose the Consumer's Income Elasticity for Good Is -0

question 27

Multiple Choice

Suppose the consumer's income elasticity for good is -0.10 when monthly income is $1,000,and the consumer's income elasticity for good is 0.10 when monthly income is $2,000.From this information we can infer that

• A) good is an inferior good for low levels of income and a superior good for high levels of income.
• B) good is a normal good for low levels of income and an inferior good for high levels of income.
• C) good in an inferior good for low levels of income and a normal good for high levels of income.
• D) good is a Giffen good.

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Definitions:

Fear Neutral Stimuli

Stimuli that originally do not provoke fear responses but can become fear-inducing when associated with a negative event.

Shock

A medical emergency involving a sudden drop in blood flow throughout the body, or a strong emotional or physical response to a traumatic event.

Stimulus Generalization

The psychological phenomenon where a response to a specific stimulus is elicited by similar stimuli, indicating a lack of discrimination.

Panic Attack

A sudden onset of intense fear or discomfort, marked by various physical and psychological symptoms that occur abruptly and peak within minutes.