Answer the question

in 2016, average incomes in a country rose from 30 000 to 32 400. this caused a change in the quantity demanded for two particular products:x and y. The total annual quantity demanded for product x rose from 24 million units to 30 million units. however, the quantity demanded for product y fell from 10 units to 9 million units.

1. Calculate the income elasticity of demand for products X & Y.

2. Are the 2 products (X & Y) income elastic or income inelastic.

3. Are the 2 products X and Y normal or inferior? Give an explanation in your answer.

Engberg company installs lawn sod in home yards. the company’s most recent monthly contribution format income statement follows: amount percent of sales sales $ 80,000 100% variable expenses 32,000 40% contribution margin 48,000 60% fixed expenses 38,000 net operating income $ 10,000 required: 1. compute the company’s degree of operating leverage. (round your answer to 1 decimal place.) 2. using the degree of operating leverage, estimate the impact on net operating income of a 5% increase in sales. (do not round intermediate calculations.) 3. construct a new contribution format income statement for the company assuming a 5% increase in sales.