income elasticity of demand Flashcards
1
Q
discretionary expenditure
A
non essential spending or spending that is not automatic
2
Q
income elastic demand
A
percentage change in demand is proportionately greater than percentage change in income, greater than 1
3
Q
income inelastic demand
A
percentage change in demand is proportionately less than percentage change in income, less than 1
4
Q
income elasticity of demand
A
the responsiveness of demand to a change in income
