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ECON 201 (44)
Lecture

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Department
Economics
Course
ECON 201
Professor
Corey Van De Waal
Semester
Fall

Description
Inecessity a means 11 means a luxury good1meansanecessityIIeeeQ I IQIQI inIinin Q IeAn Engel curve relates changes in income to changes0 then we have a normal good 0 then we have an inferior goodIILECTURE 2Income Elasticity of Demand eDefinitionIf eIf eEngel Curvesin quantity demandedFor example for a normal good as income increases so too does quantity demandedOn the other hand for an inferior good as income increases the quantity demanded of the good decreasesIon IncomeIIncomespent income ofInferior goodsin I in Q q percentage Iethe qI increases IncomeIIncomeincome asthatNormal goodsI in I in Qstatesq Law II eqEngelLawstatesthatasincomeincreasesthepercentageofincomespentonEngelcertain foods declinesIn general it has been empirically observed that as income rises some goods that were normal become inferior
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