If the income elasticity of demand for a Snickers bar is 0.59, then we know that within the relevant price range for Snickers bars, it is
A) price elastic
B) price inelastic
C) income inelastic
D) income elastic
E) according to the economist's definition of inferior, an inferior good

Question

Quizplus · Accepted Answer

Income elasticity of demand measures how the quantity demanded of a good responds to a change in income. A value between 0 and 1 (0.59 in this case) indicates that the good is a necessity (income inelastic), meaning demand increases with income, but at a slower rate than income increases.

If the Income Elasticity of Demand for a Snickers Bar