The difference between price elasticity of demand and income elasticity of demand is that
A) income elasticity of demand examines how an individual's income changes when prices change and the price elasticity of demand examines how quantity demand changes when price changes.
B) income elasticity refers to the movement along the demand curve while price elasticity refers to a horizontal shift of the demand curve.
C) income elasticity measures the responsiveness of income to changes in supply while price elasticity of demand measures the responsiveness of demand to a change in price.
D) income elasticity refers to a horizontal shift of the demand curve while price elasticity of demand refers to a movement along the demand curve.
D
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Government stabilization policy would be unnecessary if the economy automatically gravitated toward
A. full inflation. B. full employment. C. full recession. D. an inflationary gap.
Who gains from a law requiring people who want to enter the taxicab business to prove they are thoroughly competent, honest, and reliable before they can obtain a license?
A) Local people who use taxicabs frequently and regularly B) Local people who use taxicabs only occasionally C) Out-of-town visitors who use taxicabs D) Owners of taxicab licenses E) Potential owners and operators of taxicabs who are members of minority races
In the figure above, the marginal cost of producing a computer
A) increases as more computers are produced. B) stays the same as more computers are produced. C) decreases as more computers are produced. D) is the same as the marginal cost of producing a television set.
Prior to 2008, the bank's cost of holding reserves equaled
A) the interest paid on deposits times the amount of reserves. B) the interest paid on deposits times the amount of deposits. C) the interest earned on loans times the amount of loans. D) the interest earned on loans times the amount on reserves.