Asked by
Brooklyn Jackson
on Oct 26, 2024
Verified
The income elasticity of demand for eggs has been estimated to be 0.57.If income grows by 5% in a period,all other things unchanged,demand will:
A) increase by more than 5.7%.
B) increase by about 2.9%.
C) decrease by more than 5.7%.
D) decrease by less than 5.7%.
Income Elasticity
A measure of how much the demand for a good or service changes in response to changes in consumer income.
Demand Increase
A situation where the quantity of a product or service that consumers are willing and able to buy at a given price rises.
- Gain insight into the principle of income elasticity of demand and how it contrasts with price elasticity.
Verified Answer
JR
Learning Objectives
- Gain insight into the principle of income elasticity of demand and how it contrasts with price elasticity.