Assume That a Family Spends 35% of Its Income on Housing

Multiple Choice

Assume that a family spends 35% of its income on housing, 20% on travel-related expenses, 10% on utilities, 25% on health care, and 5% on miscellaneous items. Demand for which category will be most responsive to a change in price?

A) miscellaneous
B) health care
C) utilities
D) travel-related expenses
E) housing