Howard Buys 5 Suits a Year When He Earns $70,000

question 112

Multiple Choice

Howard buys 5 suits a year when he earns $70,000. When his income increases to $200,000, he buys 15 suits a year. From the midpoint method, his income elasticity of demand for suits is:

• A) 1.04
• B) 0.96
• C) -1.04
• D) -0.96
• E) 0.08

---

Definitions:

Tuition Payment

The act of paying for instruction, especially at a school or university.

Nonpublic School

A learning establishment that functions autonomously from the public education system, typically financed by tuition fees, personal donations, or faith-based groups.

Metaphors

Figures of speech in which a word or phrase is applied to an object or action to which it is not literally applicable, often providing a symbolic comparison.

Cognitive Development

The process by which individuals perceive, think, and gain understanding of their world through the interaction of genetic and learned factors.