If the Demand for a Product Has an Income Elasticity

question 56

Multiple Choice

If the demand for a product has an income elasticity of -3.4,we can conclude that

• A)an increase in income will lead to an increase in demand for the product.
• B)the product is certainly a necessity.
• C)the product is a normal good.
• D)the product has a rising income-consumption curve.
• E)a decrease in income will lead to an increase in demand for the product.

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Definitions:

Entire Marketing Function

All activities and processes involved in promoting and selling a product or service, including product development, pricing, distribution, and advertising.

Producer

An individual or organization that creates or supplies goods or services.

Selling Agent

An individual or entity that represents sellers in transactions, responsible for finding buyers and negotiating sales on behalf of their clients.

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