Economics 9708 · AS & A Level · Income elasticity of demand

Income elasticity of demand — practice question

In a market for a good, demand and supply both alter at the same time. Which pair of changes would let an economist say with certainty that greater resources will be required for its production, while not knowing the direction of the resulting change in price?

  • Ademand decrease, supply decrease
  • Bdemand decrease, supply increase
  • Cdemand increase, supply decrease
  • Ddemand increase, supply increase

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