A-LevelEconomicsThe Price System and the MicroeconomyOct/Nov 2011Paper 1 Q61 Mark
It was estimated in 2010 that milk had an income elasticity of demand of -0.6. What can be concluded about milk from this information?
AIt accounts for only a small proportion of household expenditure.
BIt has very few substitutes.
CHousehold expenditure on milk will decrease if the price of milk increases.
DIt is an inferior good.
✓ Correct Answer
The correct answer is D. This question tests the candidate's understanding of the price system and the microeconomy within the Economicssyllabus. The examiner's mark scheme requires...
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Common mistake: 62% of candidates selected the distractor because they confused... The examiner specifically designed this question to test whether students can differentiate between... To secure full marks, candidates must demonstrate...
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