<>= # TRUE/FALSE solutions for answers (partly created with ChatGPT) sol <- rep(c(TRUE, FALSE), c(7, 10)) ## randomly invert solution to make cheating more difficult type <- sample(c("correct", "\\\\textbf{not} correct"), 1) if(type != "correct") sol <- !sol ## randomly change wording for some answers (without consequences for correctness) dir_change1 <- sample(c("increases", "decreases"), 1) ext_change1 <- sample(1:3, 1) + c(0, sample(1:2, 1)) dir_change2 <- sample(c("increases", "decreases"), 1) @ \begin{question} Which of the following statements about the income elasticity of demand are \Sexpr{type}? \begin{answerlist} \item If the income elasticity of demand is positive, the good is said to be a normal good. \item The income elasticity of demand indicates how strongly the demand for a good reacts to a change in income. \item If the income \Sexpr{dir_change1} by \Sexpr{ext_change1[1]}\% and thus the demand for a good \Sexpr{dir_change1} by \Sexpr{ext_change1[2]}\%, it is called a luxury good. \item If the income elasticity of demand is negative, one speaks of an inferior good. \item The income elasticity of demand can be positive or negative. \item A Giffen good is a special case of an inferior good where demand \Sexpr{dir_change2} if the price of the good \Sexpr{dir_change2}. \item An income elasticity of demand equal to one means that the demand for the good increases proportional to the change in income. \item The income elasticity of demand indicates how strongly the demand for a good responds to a change of the price. \item If the income elasticity of demand is positive, the good is said to be inferior. \item The income elasticity of demand is the same for all goods. \item If the income elasticity of demand is zero, the good is called a luxury good. \item If the income elasticity of demand is greater than one, the good is called a normal good. \item The income elasticity of demand is the same for all consumers. \item The income elasticity of demand is independent of the good's price. \item The income elasticity of demand can range between zero and infinity. \item Giffen goods are luxury goods for which the demand decreases as income increases. \item Common goods are goods that are purchased preferentially by a certain part of the population. \end{answerlist} \end{question} \begin{solution} This question refers to the definition of income elasticity in Varian (2014, \emph{Intermediate Microeconomics: A Modern Approach}, 9th ed.), Chapter 15. \end{solution} \exname{Income elasticity} \extype{mchoice} \exsolution{\Sexpr{mchoice2string(sol)}} \exshuffle{5}