If the Income Elasticity of Demand of a Good Is

question 202

Multiple Choice

If the income elasticity of demand of a good is negative, we can conclude that the good is:

• A) a normal good.
• B) an inferior good.
• C) a substitute.
• D) a complement.

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Definitions:

8%

A percentage, often representing an interest rate, return on investment, or growth rate.

Annuity Contract

A financial product sold by financial institutions that provide a fixed stream of payments to an individual for a period of time.

8% Return

An investment objective or outcome where the investor aims to achieve an annual return of 8 percent on the invested principal.

Interest Rate

The percentage at which interest is paid by a borrower for the use of money that they borrow from a lender.