Which of the following items is likely to have the highest income elasticity of demand?

With free entry

A) economic profits are possible over the long run. B) economic profits are possible but only over limited amounts of time. C) economic profits are not possible. D) the cost of capital will not be covered.

If the price of inputs rises and foreign income rises:

a. Price index rises, and real GDP falls. b. Price index rises, and the change in real GDP is uncertain. c. Price index falls, and real GDP rises. d. Price index falls, and real GDP falls. e. Price index falls, and the change in real GDP is uncertain.