This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: What does the income elasticity of demand measure? What will be an ideal ... (Read 57 times)

Medesa

  • Hero Member
  • *****
  • Posts: 507
on: Jun 29, 2018
What does the income elasticity of demand measure?
 
  What will be an ideal response?

Question 2

Why are consumers in a competitive market considered to be price takers?
 
  What will be an ideal response?


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

alexanderhamilton

  • Sr. Member
  • ****
  • Posts: 334
Reply #1 on: Jun 29, 2018
Answer to Question 1

The income elasticity of demand measures how the quantity demanded of a good responds to a change in income. The formula for the income elasticity of demand is the percentage change in the quantity of the good demanded divided by the percentage change in income.

Answer to Question 2

A consumer in a competitive market can buy any quantity of a good without affecting the market price, and is therefore considered to be a price taker. This is because a competitive market is characterized by many buyers and sellers and each consumer only buys a small fraction of the total quantity supplied of a good.


Medesa

  • Member
  • Posts: 507
Reply 2 on: Jun 29, 2018
YES! Correct, THANKS for helping me on my review

kishoreddi

  • Member
  • Posts: 329
Reply 3 on: Yesterday
:D TYSM

« previous next »
 

Did you know?

The use of salicylates dates back 2,500 years to Hippocrates's recommendation of willow bark (from which a salicylate is derived) as an aid to the pains of childbirth. However, overdosage of salicylates can harm body fluids, electrolytes, the CNS, the GI tract, the ears, the lungs, the blood, the liver, and the kidneys and cause coma or death.

Did you know?

The first oncogene was discovered in 1970 and was termed SRC (pronounced "SARK").

Did you know?

Before a vaccine is licensed in the USA, the Food and Drug Administration (FDA) reviews it for safety and effectiveness. The CDC then reviews all studies again, as well as the American Academy of Pediatrics and the American Academy of Family Physicians. Every lot of vaccine is tested before administration to the public, and the FDA regularly inspects vaccine manufacturers' facilities.

Did you know?

Asthma occurs in one in 11 children and in one in 12 adults. African Americans and Latinos have a higher risk for developing asthma than other groups.

Did you know?

Patients who have undergone chemotherapy for the treatment of cancer often complain of a lack of mental focus; memory loss; and a general diminution in abilities such as multitasking, attention span, and general mental agility.

Performing a Spirometry Test to Measure Forced Vital Capacity Performing a Spirometry Test to Measure Forced Vital Capacity
Performing a Spirometry Test to Measure Forced Vital Capacity Performing a Spirometry Test to Measure Forced Vital Capacity
Determination of Income Inequality Determination of Income Inequality
Income per Capita versus Total Fertility Rate Income per Capita versus Total Fertility Rate
Infant mortality by income quintile, urban Canada, 1996 Infant mortality by income quintile, urban Canada, 1996
Under ideal conditions, a single cell of the bacterium E. coli would divide every 20 minutes to ... Under ideal conditions, a single cell of the bacterium E. coli would divide every 20 minutes to ...
Video: Flexor reflex & Crossed extensor reflex

For a complete list of videos, visit our video library