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
Related Economics A Level answers
All answers ▸Evaluate the view that a reduction in UK unemployment is best achieved through the use of supply-side policies.
Explain how The Monetary Policy Committee controls inflation within the UK economy.
Explain how the diagram for a perfectly competitive firm demonstrates static efficiency.
In the early 2010s the mobile phone company Orange merged with another mobile Network firm, T Mobile, in order to a form a new company called EE. Explain what type of merger this is and discuss some of the possible costs and benefits of this merger.