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Question
Howard buys 5 suits a year when he earns $70,000. When his income increases to $200,000, he buys 15 suits a year. From the midpoint method, his income elasticity of demand for suits is
a. 1.04.
b. 0.96.
c. -1.04.
d. -0.96.
e. 0.08.
Answer
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