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) O htt ciples of Type your answer in the box. elasticity of demand is a measure of how responsive demand is to a change in D
/flow/connect.html mics Type your answer in the box. Suppose that the quantity of umbrellas demanded at a price of $6 is 3,00
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Answer #1

1) Income elasticity of demand is a measure of how responsive demand is to a change in consumer income.

Income elasticity of demand refers to the percentage change in demand for a commodity with respect to the percentage change in the income of the consumer.

Basically, it measures how much the quantity demanded changes with respect to the change in income.

2) Suppose that the quantity of umbrellas demanded at a price of $6 is 3000 units. The company's total revenue is $18000

Total Revenue = Price x Quantity

Total Revenue = $6 x 3000

Total Revenue = $18000

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