Calculate income elasticity of demand for the product

Reference no: EM13834295

When income goes up from $20,000 to $30,000, demand for product A is going up from 300 to 400. The price of the product A is $200. However demand for product B is going down from 100 to 50. The price of the of the product B is $10. Is the Product A normal goods or inferior goods? Calculate income elasticity of demand for the product A, using the mid-point approach. Is product B normal goods or inferior goods? Calculate income elasticity of demand for the product B, using the mi-point approach.

Reference no: EM13834295

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