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Unformatted text preview: Extra Credit (3 points) Maria has decided always to spend one-third of her income on clothing. What is her income elasticity of clothing demand? Answer : This comes from the textbook, question 5 on page 110. If her income doubles, she will double her spending on clothing. So the income elasticity of demand is 1....
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This note was uploaded on 02/02/2009 for the course ECON 62140 taught by Professor Ouyang during the Spring '08 term at UC Irvine.
- Spring '08