Gujarat BoardEnglish MediumSTD 11 CommerceEconomicsDemand1 Mark
Question
What is income elasticity of demand?
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Answer
The extent $($degree$)$ of change in demand for a good because of a change in income of the consumer is called income elasticity of demand.Income elasticity $\left(\varepsilon_{y}\right)=\frac{\text { Proportionate change in demand }}{\text { Proportionate change in income }}$
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