For a normal good, quantity demanded
a. increases as income rises, so the income elasticity of demand is positive
b. increases as income rises, so the income elasticity of demand is negative
c. falls as income rises, so the income elasticity of demand is positive
d. falls as income rises, so the income elasticity of demand is negative
e. remains unchanged as income rises, so the income elasticity of demand is zero
A
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The goal of a seller is primarily to:
A) maximize sales. B) maximize profits. C) minimize costs. D) minimize consumer surplus.
The price elasticity of demand equals magnitude of the
A) change in the price divided by the change in quantity demanded. B) change in the quantity demanded divided by the change in price. C) percentage change in the price divided by the percentage change in the quantity demanded. D) percentage change in the quantity demanded divided by the percentage change in the price.