1. Justine consumes two goods these days, Ice Cream and DVDs. Suppose we estimate Justine's demand for Ice Cream and find the following relationship:
Suppose you are given, and.
a) Find the own-price elasticity of demand for Ice Cream.
b) Find the cross-price elasticity of demand for Ice Cream.
c) Find the income elasticity of demand for Ice Cream.
d) What can you conclude from this information (i.e. what type of good is Ice Cream for Justine: inelastic or elastic, a substitute or complement of DVDs, normal or inferior)?