Question: A worker eats at a restaurant once a week. He then gets a 25% raise. As a result, he decides to eat out twice as

A worker eats at a restaurant once a week. He then gets a 25% raise. As a result, he decides to eat out twice as much as before and cut back on the number of frozen pizza he eats from two every week to one every week. Determine the income elasticity of demand for eating at a restaurant and for eating frozen pizza. Determine if either is a normal good or an inferior good. You must show your work to receive full credit.

Grading Rubric (for instructor use only): Elasticities Calculations out of 50 Showed

Grading Rubric (for instructor use only): Elasticities Calculations out of 50 Showed work out of 10 Inferior & Normal (Question 1) out of 20 Elastic/inelastic (Question 2) out of 20 TOTAL out of 100

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