Q358
Calculate income elasticity for the household when the income of a household rises by 10% and the demand for Rice rises by 5%.
A.
-0.5
B.
0.5
AnswerC.
-2
D.
2
Answer: Option B
Solution
Answer: Option B
Solution:
Income elasticity for the household when the income of a household rises by 10% and the demand for Rice rises by 5% is 0.5. Income Elasticity = (% change in quantity demanded) / (% change in income).