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In a study published in 1980, B. Gibson estimated the following price and income elasticities of demand for six types of public goods:

In a study published in 1980, B.B. Gibson estimated the following price and income elasticities of demand for six types of public goods:

State Activity Price elasticity Income elasticity
Aid to needy people -.83 .26
Pollution Control -.99 .77
Colleges and Univ. -.87 .92
Elementary school aid -1.16 1.14
Parks and Rec areas -1.02 1.06
Highway constr. & mainten. -1.09 .99

a)Do these public goods conform to the law of demand? For which public goods is demand price elastic? b) What types of goods are these goods? c) If the price or cost of college and university education increased by 10% and, at the same time, incomes also increased by 10%, what would be the change in the demand for college and university education?
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In a study published in 1980, B. B. Gibson estimated the following price and income elasticities
of demand for six types of public goods:
State Activity Price Income
Elasticity Elasticity
Aid to...

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