If household income increases by 50% and desired household expenditure on vacation travel increases by 15%,the price elasticity of demand for vacation travel is
A)elastic.
B)inelastic.
C)unity.
D)positive.
E)not determinable from the information given.

Question

Quizplus · Accepted Answer

The price elasticity of demand measures the responsiveness of quantity demanded to a change in price, not income. The information provided relates to income elasticity, not price elasticity.

If Household Income Increases by 50% and Desired Household Expenditure