Suppose that the income of the average Canadian household increases because a la

Question

Suppose that the income of the average Canadian household increases because a larger percentage of women enter the labour force. What do you think will happen to demand for the following products or services? What does your answer imply about income elasticity of demand in each case? What does your answer imply about a shift of the demand curve in each case? Explain. LO3, LO5, LO6 raw potatoes in 10 kg bags oven-ready French fries in 2 kg bags skinless, boneless chicken breasts whole, uncooked chickens Would you expect the sign of the cross-price elasticity of demand for each pair listed below to be positive

Explanation / Answer

option A)Raw potatoes in 10 Kg bags –

Demand will remain constant.

Income elasticity does not exist as it is an inferior good.

Demand curve will not shift

Oven-ready French fries in 2 Kg bags, Skinless or Boneless chicken breasts, Whole , uncooked chicken

Demand will increase.

Income elasticity can be seen as all of the others are also normal.

Demand curve will shift upwards.

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.