When consumers' incomes increased 10 percent, the quantity of milk bought increased 5 percent. This result means
A) the demand for milk is income elastic.
B) milk is a necessity.
C) milk is a luxury.
D) milk is an inferior good.

Question

Quizplus · Accepted Answer

Milk is a necessity because the percentage increase in quantity demanded is less than the percentage increase in income, indicating it is income inelastic.

When Consumers' Incomes Increased 10 Percent, the Quantity of Milk