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

Income elasticity of demand — practice question

A product is priced higher than the market equilibrium price. As the market moves back towards equilibrium, which combination of changes must definitely occur?

  • Aquantity demanded falls, quantity supplied falls
  • Bquantity demanded falls, quantity supplied rises
  • Cquantity demanded rises, quantity supplied falls
  • Dquantity demanded rises, quantity supplied rises

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