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

Income elasticity of demand — practice question

If market conditions shift so that supply falls, the price of the product rises. The product has a downward-sloping demand curve. What must happen as a result of this higher price?

  • Aa decrease in the demand for substitutes
  • Ba decrease in the quantity demanded
  • Can increase in the factors employed in the industry
  • Dan increase in producer’s revenue

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