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

Income elasticity of demand — practice question

The diagram illustrates market demand for, and supply of, a good. Which statement is not correct?

  • AAt price OP1, UV represents the market surplus.
  • BAt price OP3, P3X represents the quantity that consumers are able and willing to buy.
  • CIf price were to fall from OP1 to OP3, the extra quantity demanded would be equal to the extra quantity supplied.
  • DPrice OP2 is the market equilibrium price.

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