Decided to always spend one-third of her income on clothing

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Reference no: EM13886758

Maria has decided to always spend one-third of her income on clothing.

Her income elasticity of clothing demand is (less than equal to greater than) 1.

Her price elasticity of clothing demand is (less than equal to greater than) 1.

Suppose Maria’s tastes change and she decides to spend only one-fourth of her income on clothing.

This causes Maria’s demand for clothing to (remain the same increase decrease) . Now her income elasticity of clothing demand is (less than equal to greater than) 1, and her price elasticity of clothing demand is (less than equal to greater than) 1.

Reference no: EM13886758

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