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

Income elasticity of demand — practice question

The diagram illustrates the demand for and supply of hotel accommodation. The market equilibrium is shown at point E. The hotel gets a very large number of bad reviews about the quality of its accommodation. Which point on the diagram would represent the new market equilibrium?

  • Apoint A
  • Bpoint B
  • Cpoint C
  • Dpoint D

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