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The table you're working with relates income (M) to the quantity of a good (Q) consumed, asking you to calculate income elasticity of demand and classify the goods accordingly.

To solve this, we'll follow these steps:

### Step 1: Calculate the percentage change in income (%ΔM) and quantity (%ΔQdx).

The formula for percentage change between two values is:

\[
\% \Delta M = \frac{M_2 - M_1}{M_1} \times 100
\]

\[
\% \Delta Qdx = \frac{Q_2 - Q_1}{Q_1} \times 100
\]

Where $M_1$ and $M_2$ are successive income levels, and $Q_1$ and $Q_2$ are the quantities of good X corresponding to those income levels.

### Step 2: Calculate income elasticity of demand (Ei) using the formula:

\[
Ei = \frac{\% \Delta Qdx}{\% \Delta M}
\]

### Step 3: Classify the goods based on income elasticity:
- **Ei > 1**: The good is a **luxury good**.
- **0 < Ei < 1**: The good is a **normal good**.
- **Ei < 0**: The good is an **inferior good**.

I will start by calculating the percentage changes and income elasticity for each interval in the table and fill in the blanks accordingly. Let me do the calculations for you.Here's the completed table based on the given data and the calculations for income elasticity and the classification of goods:

| Income ($) | Quantity of Good X (units/yr) | %ΔM    | %ΔQdx    | Income Elasticity | Classification of Goods |
|------------|-------------------------------|--------|----------|-------------------|-------------------------|
| 12,000     | 280                           | 140.00 | 180.00   | 1.29              | Luxury good             |
| 20,000     | 504                           | 66.67  | 80.00    | 1.20              | Luxury good             |
| 29,000     | 705                           | 45.00  | 39.88    | 0.89              | Normal good             |
| 40,000     | 846                           | 37.93  | 20.00    | 0.53              | Normal good             |
| 53,000     | 750                           | 32.50  | -11.35   | -0.35             | Inferior good           |
| 65,000     | 677                           | 22.64  | -9.73    | -0.43             | Inferior good           |

### Summary:
- **Luxury goods** have an income elasticity greater than 1.
- **Normal goods** have an income elasticity between 0 and 1.
- **Inferior goods** have a negative income elasticity.

Would you like further explanations or details on any of the steps? Here are 5 follow-up questions to deepen your understanding:

1. How does income elasticity influence the demand for a good?
2. What factors might cause a good to be classified as inferior?
3. Can a good change its classification over time? Why or why not?
4. What is the significance of a negative income elasticity?
5. How might luxury goods affect consumer spending during economic downturns?

**Tip:** To distinguish between normal and inferior goods, consider how consumer purchasing behavior changes as their income rises.

Shown in the table is the income of an individual with the corresponding unit of goods it can purchase. Fill in the blanks and solve for the income elasticity. Also, indicate the classification of goods.

Learn how to calculate the income elasticity of demand and classify goods as luxury, normal, or inferior. Includes step-by-step calculation of percentage changes in income and quantity for various income levels, as well as the interpretation of elasticity results. Suitable for Grades 11-12 economics or business students.

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