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

Income elasticity of demand — practice question

A country’s central bank has asked for a report about the demand for houses and house prices. Which combination of reasons would be the most likely to cause both the price and the quantity demanded of houses to rise?

  • Aincomes down, interest rates unchanged, wages of bricklayers up
  • Bincomes down, interest rates up, wages of bricklayers unchanged
  • Cincomes unchanged, interest rates up, wages of bricklayers down
  • Dincomes up, interest rates down, wages of bricklayers unchanged

Worked solution & mark scheme

This 1-mark question has a full step-by-step worked solution and mark scheme.

  • Full mark scheme, point by point
  • Step-by-step worked solution
  • Write your answer & get it marked instantly by AI