If a 5% Increase in Income Increases Quantity Demanded by 4

question 130

Multiple Choice

If a 5% increase in income increases quantity demanded by 4%, the income elasticity of demand is:

• A) 1.25.
• B) 0.80.
• C) 2.0.
• D) 0.02.

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Definitions:

Quantity Specified

The exact amount or number of items detailed in a contract or agreement for sale, purchase, or production.

Six-Months' Notice

A requirement to alert or inform someone or a party about something six months in advance.

Workers' Compensation

A form of insurance providing wage replacement and medical benefits to employees injured in the course of employment, in exchange for mandatory relinquishment of the employee's right to sue their employer.

Course of Employment

Pertains to the activities an employee does within the scope of their job or duties as authorized or expected by their employer.