Answer to Question #80110 in Microeconomics for savita Saini

Question #80110
Suppose the income elasticity of demand for pre recorded music compact disks is +6.0 and the income elasticity of demand for a cabinet maker's work is +6.0. compare impact on pre recorded music compact disks and the cabinet maker work of a recession that reduces consumers income by 10%
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Expert's answer
2018-08-27T09:09:08-0400
If the income elasticity of demand for pre recorded music compact disks and for a cabinet maker's work is +6.0, then as a result of a recession that reduces consumers income by 10% the quantity of disks and work demanded will decrease by 10%*6 = 60%.

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