equal to 0. Question 7 (10 points) For a good to be considered normal, the ______ elasticity of demand must be ______. income; greater than 0 income; between 1 and 0 cross-price; less than 0 cross-price; equal to 0 Question 8 (10 points)
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Step 1: A normal good is a good whose demand increases as consumer income increases. Show more…
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Economists define normal goods as having a positive income elasticity. We can divide normal goods into two types: Those whose income elasticity is less than one and those whose income elasticity is greater than one. Think about products that would fall into each category. Can you come up with a name for each category?
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