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With the recession, average incomes have fallen from $44,375 to $41,720. Before the recession Groucho's Gizmos sold 600 gizmos a month. As an economics, predict the number of gizmos that will be sold for the following income elasticities and explain what type of good a gizmo is in the eyes of consumers (you must use the income elasticity coefficient to explain your answer).
a) EI = 1.5 b) EI = 0.5 c) EI = -2.0
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Ask questA rmuses 4 inputs to produce 1 output. The production function is f (x 1 ; x 2 ; x 3 ; x 4) =minfx 1 ; x 2 g + minfx 3 ; x 4 g.ion #Minimum 100 words accepted#
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