Income Elasticity of Demand Analysis for a Local Kayak Outfitter: Understanding the Impact of Income Growth on Sales
A local kayak outfitter has been looking over the latest data from the Census, which reported that income in the area where the outfitter is based has increased by 20%. If the outfitter then tells you that their sales increased by 10%, what would be the income elasticity of demand and how would you interpret it? 𝐸𝑌=2.00; for a 1% increase in income, the outfitter can expect to see a 2% increase in […]