The income elasticity of demand measures the responsiveness of quantity demanded to changes in income.
the percentage change in the price of a product divided by
the percentage change in consumer income.
the income effect of a change in price.
how a consumer's purchasing power is affected by a change in the price of a product.
Answer: (1st option) the responsiveness of the quantity demanded to changes in income
“In economics, income elasticity of demand measures the responsiveness of the quantity demanded for a good or service to a change in income.“
It is calculated as:
Income elasticity = %change in quantity/%change in income
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The income elasticity of demand measures the responsiveness of quantity demanded to changes in income.
The price elasticity of demand measures the responsiveness of A: quantity demanded to a change in quantity supplied. B: quantity demanded to a change in price.
Choose the CORRECT statement in relation to income elasticity of demand:It is the rate of responsiveness of the quantity demanded to change in price :It is the rate of responsiveness of the quantity demanded to change in income :It is the rate of responsiveness of the demand of one product to change in price of another productnon
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