The Income Elasticity of Demand

question 105

Multiple Choice

The income elasticity of demand

• A) is positive only.
• B) is negative only.
• C) must lie between -1 and +1.
• D) can be positive, negative, or zero.

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Definitions:

Self-fulfilling Prophecy

A belief or expectation that influences one's behavior in a way that causes the belief to become true.

Labeling

The act of identifying or describing someone or something in a specific way, often simplifying complex individuals or ideas into single terms or categories.

Harlow (1958)

Refers to the year psychologist Harry Harlow published his seminal research on maternal-separation, dependency needs, and social isolation experiments with rhesus monkeys, highlighting the importance of caregiving and companionship.

Cloth

A flexible material made by weaving, knitting, pressing, or bonding fibers together, used for making items like clothing, drapery, or bedding.