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

Income elasticity of demand — practice question

In one period, 10 000 units of a normal good are sold for US$20. In a subsequent period, sales rise to 12 000 units at US$22. What might account for this change?

  • Aan increase in indirect taxation
  • Ban increase in the cost of raw materials
  • Can increase in the price of a substitute commodity
  • Dan increase in the productivity of factors of production

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