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

Income elasticity of demand — practice question

During year 1, for the good shown in the diagram, the starting demand and supply curves are D1 and S1, and the government has imposed a maximum price of OP2. In year 2, demand shifts to D2, with no further alteration to supply conditions or to the maximum price. Which row correctly shows the market price and quantity for both years?

  • Ayear 1 price OP2 quantity OQ1 / year 2 price OP1 quantity OQ4
  • Byear 1 price OP2 quantity OQ3 / year 2 price OP2 quantity OQ5
  • Cyear 1 price OP3 quantity OQ2 / year 2 price OP1 quantity OQ4
  • Dyear 1 price OP3 quantity OQ2 / year 2 price OP2 quantity OQ3

Worked solution & mark scheme

This 1-mark question has a full step-by-step worked solution and mark scheme.

  • Full mark scheme, point by point
  • Step-by-step worked solution
  • Write your answer & get it marked instantly by AI