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The formula for measuring Income Elasticity of Demand is as follows: $$\frac{\Delta Q}{\Delta Y} \times \frac{Y_1 + Y_2}{Q_1 + Q_2}$$ Complete the following table to indicate what each of the above symbols stands for: | Symbol | Description | |--------|-------------| | \Delta Q | Change in quantity demanded | | \Delta Y | Change in consumer’s income | | Y_1 | Original income of the consumer | | Y_2 | New income of the consumer | | Q_1 | Original quantity of the good demanded - Leaving Cert Economics - Question 7 - 2009

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Question 7

The-formula-for-measuring-Income-Elasticity-of-Demand-is-as-follows:--$$\frac{\Delta-Q}{\Delta-Y}-\times-\frac{Y_1-+-Y_2}{Q_1-+-Q_2}$$--Complete-the-following-table-to-indicate-what-each-of-the-above-symbols-stands-for:--|-Symbol-|-Description-|--|--------|-------------|-|-\Delta-Q-|-Change-in-quantity-demanded-|-|-\Delta-Y-|-Change-in-consumer’s-income-|-|-Y_1-|-Original-income-of-the-consumer-|-|-Y_2-|-New-income-of-the-consumer-|-|-Q_1-|-Original-quantity-of-the-good-demanded-Leaving Cert Economics-Question 7-2009.png

The formula for measuring Income Elasticity of Demand is as follows: $$\frac{\Delta Q}{\Delta Y} \times \frac{Y_1 + Y_2}{Q_1 + Q_2}$$ Complete the following table ... show full transcript

Worked Solution & Example Answer:The formula for measuring Income Elasticity of Demand is as follows: $$\frac{\Delta Q}{\Delta Y} \times \frac{Y_1 + Y_2}{Q_1 + Q_2}$$ Complete the following table to indicate what each of the above symbols stands for: | Symbol | Description | |--------|-------------| | \Delta Q | Change in quantity demanded | | \Delta Y | Change in consumer’s income | | Y_1 | Original income of the consumer | | Y_2 | New income of the consumer | | Q_1 | Original quantity of the good demanded - Leaving Cert Economics - Question 7 - 2009

Step 1

\Delta Q

96%

114 rated

Answer

Change in quantity demanded

Step 2

\Delta Y

99%

104 rated

Answer

Change in consumer’s income

Step 3

Y_1

96%

101 rated

Answer

Original income of the consumer

Step 4

Y_2

98%

120 rated

Answer

New income of the consumer

Step 5

Q_1

97%

117 rated

Answer

Original quantity of the good demanded.

Step 6

Q_2

97%

121 rated

Answer

New quantity demanded of the good.

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