Income Elasticity of demand The income elasticity measures the response rate of the amount due to an increase (or decrease) in income of consumers. The formula for the income elasticity (IEoD), is: IEoD = (% change in the quantity required) / (% change on income) To calculate the income elasticity For example: Given the following data, calculate the income elasticity of demand changes in the consumer income 40000 $ $ 50000th The first thing we do find the data that we need. We know that income is $ 40000 and the new price is $ 50000 that we income (OLD) = $ 40000 and Income (NEW) = $ 50000. De la carte, we see that the amount requested if the income is $ 40000 and 150, if
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