Answered

At Westonci.ca, we connect you with the answers you need, thanks to our active and informed community. Get expert answers to your questions quickly and accurately from our dedicated community of professionals. Get immediate and reliable solutions to your questions from a community of experienced professionals on our platform.

Which statement below is true about the $75 Peter and his wife occasionally spend for two meals and drinks at a Korean barbecue restaurant since Peter was promoted, if the income elasticity for the expense is 2?

a. It is a substitute.
b. It is a luxury good.
c. It is a complement.
d. It is an inferior good.

Sagot :

Tundexi

Answer:

b. It is a luxury good.

Explanation:

Income Elasticity = 2

The Income Elasticity > 1. So, it is luxury goods. In economics, income elasticity for luxury goods is greater than 1 (i.e. Income Elasticity > 1). So option b is correct.

Visit us again for up-to-date and reliable answers. We're always ready to assist you with your informational needs. Thank you for choosing our platform. We're dedicated to providing the best answers for all your questions. Visit us again. Westonci.ca is here to provide the answers you seek. Return often for more expert solutions.