Use the table below to answer the following questions.
Windsurfing equipment rents for $10 per hour and snorkeling equipment rents for $5 per hour.
Table 8.2.1

-Consider Devon's total utility from snorkeling and windsurfing in Table 8.2.1. Suppose that Devon's total income rises from $35 to $55, ceteris paribus. Given that Devon changes his choice of windsurfing and snorkeling, what is his income elasticity for windsurfing?
A)zero
B)28.6
C)44.4
D)0.64
E)1.55

Question

Use the table below to answer the following questions.
Windsurfing equipment rents for $10 per hour and snorkeling equipment rents for $5 per hour.
Table 8.2.1
 
-Consider Devon's total utility from snorkeling and windsurfing in Table 8.2.1. Suppose that Devon's total income rises from $35 to $55, ceteris paribus. Given that Devon changes his choice of windsurfing and snorkeling, what is his income elasticity for windsurfing?
A)zero 
B)28.6 
C)44.4 
D)0.64 
E)1.55

Quizplus · Accepted Answer

Devon's income elasticity for windsurfing is 0.64. This is calculated by dividing the percentage change in windsurfing consumption (44.4%) by the percentage change in income (28.6%).

Use the Table Below to Answer the Following Questions