Answer to Question #24686 in Microeconomics for maggy iihuhua
a) explain the income elasticity of demand for good A and good B
Income elasticity for Good B is 4. It means that when income increases on one point, consumption of this Good B increases on 4 points. It can be some basic product, which person could not eliminate from its consumption basket and tries to consume more with income increase.
Need a fast expert's response?Submit order
and get a quick answer at the best price
for any assignment or question with DETAILED EXPLANATIONS!