Ask Question
20 November, 22:35

When Frank's income was $100 per week, 10 units of good A were demanded. Now his income is $150 per week and 12 units of good A are demanded. Using the percentage change formula, the income elasticity of demand for good A equals ___.

a. 0.40

b. 0.45

c. 2.20

d. 2.50

+5
Answers (1)
  1. 21 November, 01:40
    0
    a. 0.40

    Explanation:

    e = % change in demand/% change in income

    = (12 - 10) / 10 / (150 - 100) / 100

    = 0.40

    Therefore, The income elasticity of demand for good A equals 0.04
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “When Frank's income was $100 per week, 10 units of good A were demanded. Now his income is $150 per week and 12 units of good A are ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers