Can you explain income elasticity of demand?

Income elasticity of demand (YED) is the relationship between a change in quantity demanded for a good and the change in real income. some goods are normal and some inferior. Normal means a rise in income results in rise demand (positive income elasticity of demand value) i.e car, Rolex watch. inferior goods are when income rises demand falls. This is because there are superior options available. (Negative YED value ) I.e Tesco's own baked beans

AS
Answered by Annabel S. Economics tutor

6544 Views

See similar Economics A Level tutors

Related Economics A Level answers

All answers ▸

Explain why the housing market is not a perfectly competitive market.


How best to maximise marks in exams, for example in definitions or in 20 mark questions


Evaluate a constraint on Economic growth and development. (8)


Integrate the function f(x) = (1/6)*x^3 + 1/(3*x^2) with respect to x, between x = 1 and x = 3^(1/2), giving your answer in the form a + b*3^(1/2) where a and b are constants to be determined.


We're here to help

contact us iconContact ustelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo

MyTutor is part of the IXL family of brands:

© 2026 by IXL Learning