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Economics Homework Three Answers - Student Eight (view source)
Revision as of 12:23, September 28, 2009
, 12:23, September 28, 2009revised
'''4.''' Items which have a price elasticity less than one are considered necessities because even when the price rises most consumers still purchase them, whereas , with a good with a price elasticity of more than one, people will not purchase nearly as many if the price rises, causing the designation of unnecessary. This can be inaccurate, as [[New York Yankees]] tickets or popular video games are not "necessary."
'''4.''' Items which have a price elasticity less than one are considered necessities because even when the price rises most consumers still purchase them, whereas , with a good with a price elasticity of more than one, people will not purchase nearly as many if the price rises, causing the designation of unnecessary. This can be inaccurate, as [[New York Yankees]] tickets or popular video games are not "necessary."
:Correct.
:After grading this I realized this question has a mistake in it. See model answers.
'''5.''' Potato chips are a (poor) substitute for french fries; ketchup is a (necessary) complement for them.
'''5.''' Potato chips are a (poor) substitute for french fries; ketchup is a (necessary) complement for them.