Question

If quantity of a good demanded increases from 200 to 250 then the average income of the population increases from Rs 20,000 to Rs 30,000, find Arc Income elasticity of demand?
A) 1.45 B) 0.55 C) 2 D) 1.25

Answer 1

Answer:

answer is B 0.55

price elasticity demand = % change in quanty/% change in price