When Her Income Increases from $10,000 to $20,000, as Shown

question 127

Multiple Choice

When her income increases from $10,000 to $20,000, as shown in the accompanying table, Marguerite increases the quantity demanded from 3 to 7 rolls at a price of $3. From the midpoint method, income elasticity of demand for sushi is: $$\begin{array} { | l | c | c | } \hline \begin{array} { l } \text { Price (per } \\\text { roll) }\end{array} & \begin{array} { l } \text { Quantity } \\\text { Demanded } \\\text { (income= } \\\$ 10,000 / \text { year) }\end{array} & \begin{array} { l } \text { Quantity } \\\text { Demanded } \\\text { (income= } \\\mathbf { \$ 2 0 , 0 0 0 / y e a r ) }\end{array} \\\hline \$ 1 & 5 & 9 \\\hline \$ 2 & 4 & 8 \\\hline \$ 3 & 3 & 7 \\\hline \$ 4 & 2 & 6 \\\hline \$ 5 & 1 & 5 \\\hline\end{array}$$

• A) 0.67.
• B) 1.20.
• C) 1.33.
• D) 0.83.
• E) 0.50.

Grasp the fundamental principles of competitive equilibrium and how it relates to prices in pure exchange economies.

Distinguish between partial equilibrium analysis and general equilibrium analysis.

Comprehend the implications of the First and Second Welfare Theorems in the context of welfare economics.

Understand the impact of homothetic and Cobb-Douglas preferences on consumption allocations.

---

Definitions:

Cultural Values

are the core principles and ideals that shape behaviors, attitudes, and norms within a specific society or group.

Collective Beliefs

Represent the shared or common beliefs, values, or attitudes among a group of individuals.

Organizational

Pertaining to the structure or coordination of an organization, including its processes, systems, and management practices.

Socialize Members

The process of integrating new members into a group, team or organization, teaching them its norms and values.