{"id":44732,"date":"2024-04-15T21:47:53","date_gmt":"2024-04-15T21:47:53","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=44732"},"modified":"2024-04-15T21:47:53","modified_gmt":"2024-04-15T21:47:53","slug":"income-elasticity-of-demand-will-be-zero-when-a-given-change-in-income-brings-about","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/income-elasticity-of-demand-will-be-zero-when-a-given-change-in-income-brings-about\/","title":{"rendered":"Income-elasticity of demand will be zero when a given change in income brings about"},"content":{"rendered":"<p>[amp_mcq option1=&#8221;a less than proportionate change in quantity demanded&#8221; option2=&#8221;a more than proportionate change in quantity demanded&#8221; option3=&#8221;the same proportionate change in demand&#8221; option4=&#8221;no change in demand&#8221; correct=&#8221;option4&#8243;]<!--more--><\/p>\n<p>The correct answer is: D. no change in demand.<\/p>\n<p>Income elasticity of demand is a measure of how responsive the demand for a good or service is to changes in income. It is calculated by dividing the percentage change in the quantity demanded of a good or service by the percentage change in income.<\/p>\n<p>If the income elasticity of demand is zero, then a change in income will not cause any change in the quantity demanded of the good or service. This means that the good or service is a necessity, and people will continue to demand it regardless of their income.<\/p>\n<p>For example, food is a necessity, and the demand for food is relatively inelastic. This means that even if people&#8217;s incomes increase, they will not significantly increase their consumption of food.<\/p>\n<p>On the other hand, if the income elasticity of demand is negative, then a change in income will cause a decrease in the quantity demanded of the good or service. This means that the good or service is a luxury, and people will demand less of it as their incomes increase.<\/p>\n<p>For example, vacations are a luxury, and the demand for vacations is relatively elastic. This means that even if people&#8217;s incomes increase, they will significantly decrease their consumption of vacations.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[amp_mcq option1=&#8221;a less than proportionate change in quantity demanded&#8221; option2=&#8221;a more than proportionate change in quantity demanded&#8221; option3=&#8221;the same proportionate change in demand&#8221; option4=&#8221;no change in demand&#8221; correct=&#8221;option4&#8243;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-44732","post","type-post","status-publish","format-standard","hentry","category-economics","no-featured-image-padding"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Income-elasticity of demand will be zero when a given change in income brings about<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/income-elasticity-of-demand-will-be-zero-when-a-given-change-in-income-brings-about\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Income-elasticity of demand will be zero when a given change in income brings about\" \/>\n<meta property=\"og:description\" content=\"[amp_mcq option1=&#8221;a less than proportionate change in quantity demanded&#8221; 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