The income elasticity of demand
A) is positive only.
B) is negative only.
C) must lie between -1 and +1.
D) can be positive, negative, or zero.
D
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If a person completely smooths consumption over his lifetime, then consumption is best represented by which of the following?
A) wealth / the number of years the person expects to live B) lifetime income / the number of years the person expects to work C) (wealth + lifetime income) / the number of years the person expects to live D) (wealth + lifetime income) / the number of years the person expects to work
If a good is a normal good then
a. other things equal, no consumer will buy it b. a rise in income or wealth will increase the amount of the good that consumers will purchase c. a decline in income will increase the amount of it that consumers will purchase d. abnormal goods are never substituted for it e. normal consumers will always demand it