Income Elasticity of Demand Is Greater Than Zero for All

question 148

Multiple Choice

Income elasticity of demand is greater than zero for all of the following except:​

• A)restaurant meals.
• B)beer.
• C)owner-occupied housing.
• D)food items.
• E)rental housing.

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Definitions:

Basis Points

One basis point is equal to 1/100th of 1%, used primarily to denote the change in interest rates, equity indexes, and the yield of fixed-income securities.

Price Decline

A decrease in the market price of an asset or security.

Duration

A measure of the sensitivity of the price of a bond or other fixed-income investment to a change in interest rates, often expressed in years.

Price Volatility

The rate at which the price of an asset increases or decreases for a given set of returns, indicative of the risk or stability.