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Income elasticity of demand is defined as the responsiveness of

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Income elasticity of demand is defined as the responsiveness of

A).  Quantity demanded to a change in income

B).  Quantity demanded to a change in price

C).  Price to a change in income

D).  Income to a change in quantity demanded


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 Quantity demanded to a change in income



Income Elasticity of Demand (YED) is defined as the responsiveness of demand when a consumer's income changes. It is defined as the ratio of the change in quantity demand over the change in income. The higher the income elasticity, the more sensitive demand for a good is to changes in income.

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