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What is income elasticity of demand, when income changes by 20% and demand changes by 40%
  • a)
    1/2
  • b)
    2
  • c)
    0.33
  • d)
    None
Correct answer is option 'B'. Can you explain this answer?
Verified Answer
What is income elasticity of demand, when income changes by 20% and de...
Ed= (% change in demand) / (% change in price)
E= (40% / 20%)
E= 2 %
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Most Upvoted Answer
What is income elasticity of demand, when income changes by 20% and de...
Income elasticity of demand=%Change in quantity demanded/%Change in income=40 %/20%=2
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Community Answer
What is income elasticity of demand, when income changes by 20% and de...
Ed= (% change in demand) / (% change in price)
E= (40% / 20%)
E= 2 %
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What is income elasticity of demand, when income changes by 20% and demand changes by 40%a)1/2b)2c)0.33d)NoneCorrect answer is option 'B'. Can you explain this answer?
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