Free Printable Income Elasticity of Demand (YED)

1.

For normal goods, YED will typically be......

a)

Positive

b)

Negative

c)

None of the above

d)

Both of the above

2.

For inferior goods, YED will typically be......

a)

Positive

b)

Negative

c)

None of the above

d)

Both of the above

3.

For luxury goods, YED will typically be......

a)

Positive

b)

Negative

c)

None of the above

d)

Both of the above

4.

For luxury goods, YED will typically be......

a)

Negative

b)

More than 1

c)

Between 0 and 1

d)

None of the above

5.

What is the equation for YED?

a)

\%\ Change\ in\ quantity\ demanded\ \div\%\ Change\ in\ consumer\ incomes

b)

$\%\ Change\ in\ consumer\ incomes\ \div\%\ Change\ in\ quantity\ demanded$

c)

$\%\ Change\ in\ consumer\ incomes\ \div\%\ Change\ in\ price\ levels$

6.

What is the definition for income elasticity of demand?

a)

The resposiveness of demand to a change in price.

b)

The responsiveness of demand to a change in income.

c)

The un-resposiveness of demand to a change in price.

d)

The un-responsiveness of demand to a change in income.

7.

Negatively inelastic goods are usually inferior

a)

True

b)

False

8.

Why your income increases you purchase less of this good

a)

Normal necessity

b)

Normal luxury

c)

Inferior

d)

Giffen

9.

Why your income increases you purchase more of this good but not more than the percentage increase in your income

a)

Normal necessity

b)

Normal luxury

c)

Inferior

d)

Giffen

10.

For Normal necessity goods, YED will typically be......

a)

Positive

b)

Negative

c)

None of the above

d)

Both of the above

11.

Why your income increases you purchase more of this good, and more than the percentage increase in your income

a)

Normal necessity

b)

Normal luxury

c)

Inferior

d)

Giffen

12.

Select the correct YED

a)

0

b)

0.5

c)

1

d)

-0.3

13.

What type of good is this shoe?

a)

Necessity

b)

Inferior

c)

Sticky

d)

Luxury

Income Elasticity of Demand (YED)

Total questions: 13

Worksheet time: 10mins

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