Suppose good X has a negative income elasticity of demand. This implies that good X is
a. a normal good.
b. a necessity.
c. an inferior good.
d. a luxury.
c
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Which of the followings statements correctly identifies an advantage of using foreign aid to eradicate poverty?
A) It is extremely efficient in countries where institutions are extractive. B) It directly increases the efficiency of production in poorer countries. C) Its flow is transparent and can be questioned by all individuals in the receiving country. D) It leads to a redistribution of income around the world.
What does the specificfactors model allow us to analyze?
a. the returns to factors of production b. the allocation of resources between sectors c. the returns to factors of production and the allocation of resources between sectors d. the allocation of resources to the service sector