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9 June, 20:06

Assume that a family spends 35% of its income on housing, 20% on travel-related expenses, 10% on utilities, 25% on health care, and 5% on miscellaneous items. Demand for which category will be most responsive to a change in price?

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  1. 9 June, 23:38
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    We need the slope of each category.

    Explanation:

    Having the amount of each category is not enough to find the responsive of each one of them to a change in their prices, we need a measure called elasticity, this indicator measures the responsive of a product to a change in its price.
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Home » Business » Assume that a family spends 35% of its income on housing, 20% on travel-related expenses, 10% on utilities, 25% on health care, and 5% on miscellaneous items. Demand for which category will be most responsive to a change in price?
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