Income elasticity relates to
A) a movement down a demand curve.
B) a movement up a demand curve.
C) a horizontal shift in a demand curve.
D) the percentage change in quantity demanded divided by the percentage change in the price.

Question

Quizplus · Accepted Answer

Income elasticity of demand measures how the quantity demanded of a good responds to a change in consumers' income, leading to a horizontal shift in the demand curve, either to the left or right, depending on whether the good is a normal or inferior good.

Income Elasticity Relates to