Match List I with List II: List I and List IIList IList II A. Income elasticity greater than one I.…
Income elasticity above 1 defines a luxury(III); positive cross-price elasticity substitutes(I); a falling-price PCC sloping down toward more of the horizontal good shows…
Choose your answer
Match List I with List II:
| List I | List II |
|---|---|
| A. Income elasticity greater than one | I. Substitute goods |
| B. Positive cross price elasticity | II. Inferior goods |
| C. Downward sloping price consumption curve(PCC) | III. Luxurious goods |
| D. Negative income effect | IV. Relative elastic demand |
Answer and explanation
Correct answer D
Income elasticity above 1 defines a luxury(III); positive cross-price elasticity substitutes(I); a falling-price PCC sloping down toward more of the horizontal good shows total expenditure on that good rises, indicating elastic demand(IV). Negative demand response to higher real income describes inferiority(II). Thus A–III, B–I, C–IV, D–II.
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UGC NET Economics