1. **Problem Statement:** Judy's income increased from 130 to 170 per week. Her demand for concert tickets increased by 15%, and her demand for bus rides decreased by 10%. We need to calculate Judy's income elasticity of demand for: a. Concert tickets b. Bus rides 2. **Formula for Income Elasticity of Demand:** Income elasticity of demand (E) is calculated as: $$E = \frac{\% \text{ change in quantity demanded}}{\% \text{ change in income}}$$ 3. **Calculate the percentage change in income:** $$\% \text{ change in income} = \frac{170 - 130}{130} \times 100 = \frac{40}{130} \times 100 \approx 30.77\%$$ 4. **Calculate income elasticity for concert tickets:** Given demand increased by 15%, $$E_{concert} = \frac{15}{30.77} \approx 0.49$$ Since $E_{concert} > 0$, concert tickets are a normal good. 5. **Calculate income elasticity for bus rides:** Given demand decreased by 10%, $$E_{bus} = \frac{-10}{30.77} \approx -0.32$$ Since $E_{bus} < 0$, bus rides are an inferior good. **Final answers:** - Income elasticity of demand for concert tickets is approximately $0.49$. - Income elasticity of demand for bus rides is approximately $-0.32$.