Refer to the Accompanying Graph A Calculate the Income Elasticity of Demand for Televisions at c

question 131

Essay

Refer to the accompanying graph. $\begin{array} { | l | c | c | } \hline \text { Price } & \begin{array} { l } \text { Quantity of } \\\text { Televisions } ( \mathbf { Y } \\= \mathbf { 2 0 , 0 0 0 } )\end{array} & \begin{array} { l } \text { Quantity of } \\\text { Televisions } ( \mathbf { Y } \\= \mathbf { 3 0 , 0 0 0 0 } )\end{array} \\\hline \$ 350 & 250 & 375 \\\hline \$ 450 & 200 & 325 \\\hline \text { \$550 } & 150 & 275 \\\hline \text { \$650 } & 100 & 225 \\\hline \$ 750 & 50 & 175 \\\hline\end{array}$
a. Calculate the income elasticity of demand for televisions at a price of $550.
b. Are televisions a luxury good, necessity good, or inferior good? Explain.
c. Name a good for which consumption would likely fall when there is an increase in income from $20,000 to $30,000. Explain your reasoning.

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Definitions:

Business Visuals

Visual elements such as charts, graphs, and images used to convey business information or concepts effectively.

Racial Stereotypes

Oversimplified and generalized beliefs about a particular group of people based on their race, often leading to prejudice and discrimination.

Visual Literacy

The ability to create effective images and to correctly interpret such images.

Visual Design

The aspect of design that focuses on the aesthetics of a product and its related materials by strategically implementing images, colors, fonts, and other elements.