Suppose an individual has a fixed amount of wealth to allocate between consumption in two periods ( C 1 and C 2). Any funds not spent in period 1 will earn interest (at the rate r), which will increase purchasing power in period 2. Consider four possible reactions to an increase in r: I. C1 increases. II. C1 decreases. III. C2 increases. IV. C2 decreases. Which of these is consistent with the hypothesis that both C 1 and C 2 are normal goods

Suppose a movie theater determines it can charge different prices to patrons who go to weekday matinees and people who attend evening and weekend shows . the movie theater's goal is to increase total revenue. the price elasticity of demand for weekend and evening patrons is -0.40, and the price elasticity of demand for matinee moviegoers is -1.90. based on the price elasticity of demand for each group of people, how should the movie theater adjust its prices?