The income elasticity of demand for manufactured goods is generally thought to be __________ than the income elasticity of demand for primary products, and the price elasticity of demand for manufactured goods (when the negative sign is ignored) is __________ than the price elasticity of demand for primary products.

Question

Quizplus · Accepted Answer

Manufactured goods typically have higher income elasticity because demand for them increases more with income growth. They also tend to have higher price elasticity as consumers are more responsive to price changes compared to primary products.

The Income Elasticity of Demand for Manufactured Goods Is Generally