Question
Assume that the income elasticity of demand for Good B is 1.6.Using a correctly labeled graph of the market for Good B, show the effect
Assume that the income elasticity of demand for Good B is 1.6.Using a correctly labeled graph of the market for Good B, show the effect of a significant decrease in income on the equilibrium price and quantity of Good B in the short run.
What would the graph of this look like, and how would I show the significant decrease in income on the graph.
Thanks
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Global Business Today
Authors: Charles W. L. Hill Dr, G. Tomas M. Hult
10th edition
1259686698, 978-1259686696
