Income elasticity of different consumer goods, Managerial Economics

Assignment Help:

Income Elasticity of different consumer goods

Commodities

Coefficient of income elasticity

Impact on expenditure

Necessities

Less than unitary (ey< 1)

Less than proportionate change in income

Comforts

Almost equal to unity (ey = 1 )

Almost  proportionate change in income

Luxuries

Greater than unity (ey> 1) M

More than proportionate increase in income


Second, the concept of income elasticity could also be used to describe the 'inferior' and 'regular' goods. The goods whose income elasticity is positive for all levels of income are known as 'regular goods'. Instead, the goods for that income elasticity is negative, further than a specific level of income, are called as 'inferior goods'.


Related Discussions:- Income elasticity of different consumer goods

Monopolistic competition, Evaluate critically chamberlin''s model of monopo...

Evaluate critically chamberlin''s model of monopolistic copetition

Real and nominal measures, Real and nominal measures Output, Expenditu...

Real and nominal measures Output, Expenditure and Income can be valued at current market price in which case we speak, for example, of money or Nominal NNP, or NNP valued

Amount of labor , One lumber producer may locate a plant in the same area....

One lumber producer may locate a plant in the same area.  If it does, there will be more competition for labor and the labor supply function facing Northern will shift to

Sat scores, 100 schools are given exactly one million dollars each in grant...

100 schools are given exactly one million dollars each in grant money. They can spend the money on any or all of three programs: math tutoring (math), kickball lessons (kickball),

Derevatives ., how to solve problems using derivatives ?

how to solve problems using derivatives ?

Factors influencing supply curve, Factors influencing Supply Curve St...

Factors influencing Supply Curve State of technology     There is a direct relationship between supply and technology.  Improved technology results in more supply as with

State the fixed factor of production, State the Fixed factor of production ...

State the Fixed factor of production Input level of a fixed factor can't be varied in the short run. Capital falls under the category of fixed factor. Capital alludes to resour

What do mean by convex isoquant, Q. What do mean by Convex Isoquant? I...

Q. What do mean by Convex Isoquant? Isoquants are convex to the origin: At any point of an isoquant,the slope is negative. Its numerical value measures the marginal rate of te

Incremental profit, Electron Control, Inc., sells voltage regulators to oth...

Electron Control, Inc., sells voltage regulators to other manufacturers, who then customize and distribute the products to quality assurance labs for their sensitive test equipment

Milton friedman-demand function , Milton Friedman makes the demand for mon...

Milton Friedman makes the demand for money a function of the real per capital permanent income. in this study the demand function for money is stated as; M/NPP= r( YP/NP) δ W

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd