If a 1 percent change in income generates a greater than 1 percent change in quantity demanded for boat rentals, then the demand for boat rentals
a. is a good illustration of Engel's law
b. reflects the demand for an inferior good
c. has a price elasticity greater than one
d. is income elastic
e. is income inelastic
D
Economics
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An example of the quality change bias, and not a new goods bias, in the calculation of the CPI is a price increase in
A) Coke versus Pepsi. B) DVDs purchased on Craigslist, an online classified website. C) a 2013 GPS unit versus a 2008 GPS unit. D) etexts versus used books . E) pants purchased by a first-time shopper at Aeropostale.
Economics
If the demand for a good is perfectly elastic, the price elasticity of demand is ________ and the demand curve is ________
A) infinite; vertical B) zero; vertical C) zero; horizontal D) infinite; horizontal
Economics