If per capita income increases by 10% and household expenditure on fur coats increases by 15%,one can conclude that the price elasticity of demand for fur coats is
A)elastic.
B)inelastic.
C)unity.
D)positive.
E)not determinable from the information given.

Question

Quizplus · Accepted Answer

The information provided relates to income elasticity, not price elasticity. The change in expenditure due to income change does not determine price elasticity.

If Per Capita Income Increases by 10% and Household Expenditure