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

Income elasticity of demand — practice question

Travellers may cross the English Channel either through the Channel Tunnel or by travelling by sea. The table shows the numbers of passengers, in thousands, who used these services from 2005 to 2015. From 2005 to 2015, the price of the Channel Tunnel decreased while the price of sea journeys increased. What pattern does the data indicate?

  • AThe cross elasticity of demand between the two services is positive.
  • BThe market for crossing the English Channel grew continuously over the period.
  • CThe rate of decline in sea journeys accelerated over the period.
  • DThe two services for crossing the English Channel are complementary.

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