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Christine recently earned a promotion at work, raising her income by 40%. As a result, she now attends twice as many concerts as before. What is Christine's income elasticity of demand for concerts?

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pedrocarratore

Answer:

2.5

Explanation:

If Christine now attends twice as many concerts, her percent increase in demand for concerts was 100%. Christine's income elasticity of demand for concerts is given by the percentage change in demand divided by the percentage change in income:

[tex]E = \frac{\%D}{\%I}=\frac{100\%}{40\%}\\ E=2.5[/tex]

Christine's income elasticity of demand for concerts is 2.5.

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