Assume the number of apples purchased by a family in a week has risen from 10 to 15, the price of an apple has fallen from 50 cents to 40 cents, the number of bananas purchased has fallen from 10 to 5 because of a rise in the price of bananas from $1.20 to $1.50, and household income has increased from $900 to $950. Calculate the follwoing
a) price elasticity for apples and comment on wherather it is elastic or inelastic
b) cross price elasticity of demand for bananas and comment on whether bananas are a substitute or complement
c) income elasticity of demand and comment on whether apples are a normal or inferior good
d) what implicit assumption is made in developing these elasticities which casts concerns about the validity of the calculated elasticities?