Suppose That the Value of the Income Elasticity of Demand

Multiple Choice

Suppose that the value of the income elasticity of demand for a product is 2 and average incomes increase by 16%.What will happen to the quantity demanded?

A) It will increase by 8%.
B) It will increase by 32%.
C) It will decrease by 8%.
D) It will decrease by 32%.
E) It cannot be determined without further information.