What is the price elasticity of demand as price increases from 2 per unit to 4 per unit? Use the point formula in your calculation.

The demand curve is a straight line passing through $(Q=0, P=8)$ and $(Q=16, P=0)$.
The slope of the demand curve ($\frac{\Delta P}{\Delta Q}$) is $\frac{8-0}{0-16} = \frac{8}{-16} = -\frac{1}{2}$.
So, the inverse slope ($\frac{\Delta Q}{\Delta P}$) is $-2$.
The demand function can be written as $Q = -2P + 16$.

As price increases from $2 per unit, we use the initial point for the point elasticity formula. When$P = $2$,$Q = -2(2) + 16 = -4 + 16 = 12$. So, the initial point is$(P=2, Q=12)$.

The point elasticity of demand formula is $E_d = \frac{dQ}{dP} \times \frac{P}{Q}$.
From Step 1, $\frac{dQ}{dP} = -2$.

The absolute value of the elasticity is $\frac{1}{3}$.

The calculated elasticity is $-\frac{1}{3}$, and its absolute value is $\frac{1}{3}$.
The correct option is a) $\boxed{1/3}$.

2. Suppose that a 2% increase in price results in a 6% decrease in quantity demanded. Own-price elasticity of demand is equal to:

The formula for price elasticity of demand is $E_d = \frac{\% \Delta Q}{\% \Delta P}$.

A 6% decrease in quantity demanded means $\% \Delta Q = -6\%$.
A 2% increase in price means $\% \Delta P = 2\%$.

The absolute value of the elasticity is $|-3| = 3$.
The correct option is d) $\boxed{3}$.

3. If goods X and Y are SUBSTITUTES, then which of the following could be the value of the cross price elasticity of demand for good Y?

For substitute goods, an increase in the price of one good (e.g., good Y) leads to an increase in the quantity demanded of the other good (good X).
The cross-price elasticity of demand ($E_{xy}$) is calculated as $E_{xy} = \frac{\% \Delta Q_x}{\% \Delta P_y}$.

If $P_y$ increases (positive change), $Q_x$ increases (positive change). Therefore, the ratio of two positive changes will be positive.
So, for substitutes, the cross-price elasticity of demand must be positive ($E_{xy} > 0$).

a) -1 (negative)

b) -2 (negative)

c) Neither a) nor b).

d) Both a) and b).
Since the cross-price elasticity for substitutes must be positive, neither -1 nor -2 are possible values.
The correct option is c) $\boxed{\text{Neither a) nor b)}}$.

4. If pizza is a normal good, then which of the following could be the value of income elasticity of demand?

A normal good is a good for which demand increases as consumer income increases.
The income elasticity of demand ($E_I$) is calculated as $E_I = \frac{\% \Delta Q}{\% \Delta I}$.

If income ($I$) increases (positive change), the quantity demanded ($Q$) also increases (positive change). Therefore, the ratio of two positive changes will be positive.
So, for a normal good, the income elasticity of demand must be positive ($E_I > 0$).

a) 0.2 (positive)

b) 0.8 (positive)

c) 1.4 (positive)

d) All of the above.
All the values 0.2, 0.8, and 1.4 are positive, which is consistent with pizza being a normal good. (0.2 and 0.8 would indicate a necessity, while 1.4 would indicate a luxury, both of which are types of normal goods).
The correct option is d) $\boxed{\text{All of the above}}$.