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

Income elasticity of demand — practice question

Good X has an income elasticity of demand (YED) value of $-0.8$. Its cross elasticity of demand (XED) in relation to good Y is likewise $-0.8$. What are the features of good X?

  • Aa normal good that is a complement to good Y
  • Ba normal good that is a substitute for good Y
  • Can inferior good that is a complement to good Y
  • Dan inferior good that is a substitute for good Y

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