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

Income elasticity of demand — practice question

A US study advised teenagers to cut the quantity of fizzy drink that they drink. If this advice was followed, how could the outcome be shown on demand and supply diagrams for fizzy drinks and for sugar?

  • Adiagram for fizzy drinks: demand curve moves to the left; diagram for sugar: movement up the supply curve
  • Bdiagram for fizzy drinks: demand curve moves to the left; diagram for sugar: movement down the supply curve
  • Cdiagram for fizzy drinks: movement up the demand curve; diagram for sugar: supply curve moves to the right
  • Ddiagram for fizzy drinks: movement up the demand curve; diagram for sugar: supply curve moves to the left

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