The Ratio of the Percentage Change in Consumption of a Good

question 23

Multiple Choice

The ratio of the percentage change in consumption of a good divided by the percentage change in income (as measured by GDP) is known as the

• A)income elasticity of demand.
• B)income expansion path.
• C)demand elasticity equivalent.
• D)trade effectiveness.

---

Definitions:

Cognitive Limitations

The boundaries of human capability in processing information, making judgments, and solving problems.

Risk Environments

Provide probabilities regarding expected results for decision-making alternatives.

Objective Statistical Procedures

Quantitative methods used to analyze data and make decisions based on statistical evidence rather than subjective judgment.

Intuition

The ability to understand something instinctively, without the need for conscious reasoning.