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

Income elasticity of demand — practice question

The diagram illustrates the market for air travel in Asia. The starting market equilibrium is at X. If the price of aviation fuel increases and incomes in Asia are decreasing, what will the new equilibrium be?

  • APoint A on the diagram
  • BPoint B on the diagram
  • CPoint C on the diagram
  • DPoint D on the diagram

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