The income elasticity of demand for automobiles in the United States was estimated by a government agency

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The income elasticity of demand for automobiles in the United States was estimated by a government agency to be between 2.5 and 3.9.
a. What does this mean?
b. If incomes rise by 10 percent, what happens to the purchase of automobiles?

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Managerial Economics Markets and the Firm

ISBN: 978-0618988624

2nd edition

Authors: William Boyes

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Question Posted: Sep 27, 2014 06:15 AM

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The income elasticity of demand for automobiles in the United States was estimated by a government agency

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a For each 1 percent rise in income the d...View the full answer

Managerial Economics Markets and the Firm

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