Calculate the income elasticity of demand for DVDs, where a 10 percent increase in income results in a 20 percent increase in the quantity of DVDs demanded at a given price. Decide from your answer, whether DVDs are normal or inferior goods.

Calculate the elasticity of supply when an increase in demand causes the equilibrium price and quantity to change from $2.00 and 500 to $2.80 and 1,000, respectively.