If a 6 Per Cent Increase in Income Leads to a 4

question 222

Multiple Choice

If a 6 per cent increase in income leads to a 4 per cent increase in quantity demanded for audio books, what is the income elasticity of demand?

• A)-0.67.
• B)0)67.
• C)1)5.
• D)2)

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Definitions:

Cost of Goods Sold

Direct costs attributable to the production of goods sold by a company, including materials and labor.

Inventory Period

The average time it takes for a company to turn its inventory into sales, reflecting the efficiency of its inventory management.

Cost of Goods Sold

The costs directly connected to the manufacture of goods a firm sells, comprising materials and labor.

Accounts Receivable

Money owed to a business by its customers for goods or services delivered but not yet paid for.