Let Ed_GIrefer to the income elasticity for gasoline. Suppose Ed_GI= 2, then this means that A) if income increases by 2%, then Qd_Gwill increase by 1% B) if income decreases by 1%, then Qd_Gwill decrease by 2% C) if income increases by $1, then Qd_Gwill decrease by 2% D) if income decreases by 2%, then Qd_Gwill decrease by 1%

Question

Quizplus · Accepted Answer

Income elasticity of 2 means that for every 1% change in income, the quantity demanded changes by 2% in the same direction.

Let EdGIrefer to the Income Elasticity for Gasoline

Let Ed_GIrefer to the Income Elasticity for Gasoline