If a 5 Percent Increase in Income Leads to a 10

question 116

Multiple Choice

If a 5 percent increase in income leads to a 10 percent increase in quantity demanded for airline travel, then airline travel is

• A)a necessity.
• B)a substitute for another good.
• C)a luxury.
• D)an inferior good.

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Definitions:

Credit Balance

A situation in an account where the total credits exceed the total debits, indicating an amount owed to the account holder or a surplus in a liability account.

Common Stock

A type of equity security that represents ownership in a corporation, with shareholders entitled to vote on corporate matters and receive dividends.

Acquisition

The process by which a company purchases most or all of another company's shares in order to take control of it.