The Income Elasticity of Demand for Eggs Has Been Estimated

question 27

Multiple Choice

The income elasticity of demand for eggs has been estimated to be 0.57.If income grows by 15 percent in a period, how will that affect total expenditures on eggs in that period, all other things unchanged?

• A) total expenditures will fall
• B) total expenditures will rise
• C) total expenditures will remain unchanged
• D) not enough information is given to answer the question

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