JAMB Economics 2019 Objective — Question 6

Question 6 of 40 from the Joint Admissions and Matriculation Board (JAMB) Economics 2019 Objective paper, with the correct answer and a full explanation.

If income rises from ₦2,000 to ₦4,000 and quantity demanded increases from 80 units to 120 units, find the income elasticity of demand

A. 0.5Correct
B. 1.2
C. 2.5
D. 4.0

Explanation

% change in quantity demanded = (120−80)/80×100 = 50%. % change in income = (4000−2000)/2000×100 = 100%. Income elasticity of demand = 50/100 = 0.5.

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