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

Income elasticity of demand — practice question

The figure presents the market demand for and supply of good E. Equilibrium has moved from X to Y. Which statement is not correct?

  • AIncomes of consumers may have increased and good E is a normal good.
  • BThe quantity supplied has risen because price has increased.
  • CThe quantity supplied has risen because the production of good E has been subsidised.
  • DThe price of good F, which is a substitute for good E, may have risen.

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