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Sheila purchased 7 pairs of shoes. Holding other factors constant and using the midpoint method, it follows that Sheila's income elasticity of demand is about:

a. 1.7, and Sheila regards shoes as an inferior good.

User Spijs
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Final answer:

The question involves understanding income elasticity of demand, which measures how the quantity demanded of a good responds to a change in consumer income. Normal goods have positive elasticity, while inferior goods have negative elasticity. The question pertains to whether shoes are an inferior good for Sheila based on her purchases, which cannot be determined without additional data.

Step-by-step explanation:

The subject of this question is Business, specifically the concept of income elasticity of demand in economics. The question appears to be appropriate for a College level course that includes topics in microeconomics.

When discussing income elasticity of demand, it's important to note that it measures the responsiveness of the quantity demanded of a good to a change in consumer income. Goods with positive income elasticity are called normal goods, meaning consumers buy more of them as their income rises. On the other hand, goods with negative income elasticity are called inferior goods, which means consumers buy less of them as their income increases.

In the context of the question, if Sheila's income elasticity of demand for shoes is negative, it would imply that shoes are an inferior good for her, meaning that as her income rises, she would actually purchase fewer shoes. However, simply purchasing 7 pairs of shoes does not inherently indicate the elasticity; we would additionally need information about changes in Sheila's income and her subsequent changes in shoe purchases to calculate her income elasticity of demand.

User SandeepAggarwal
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