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

Income elasticity of demand — practice question

A company consumes large quantities of gas when making steel. Gas supplies fall at the same time that the steel market is affected by a recession. What can be said about the likely changes in the market for steel?

  • Aequilibrium price falls; equilibrium quantity uncertain
  • Bequilibrium price rises; equilibrium quantity uncertain
  • Cequilibrium price uncertain; equilibrium quantity falls
  • Dequilibrium price uncertain; equilibrium quantity rises

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