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That depends on whether the elasticity is below or above +1. Income elasticities and budget shares īeing a normal good (elasticity > 0) means that with higher income, consumption of the good will rise, but it does not mean that the good's share of the consumer's budget will rise with income. Estimates for income elasticities of demand for gasoline in developed economies range from 0.66 to 1.26. Income elasticities of demand for gasoline and diesel have been studied extensively, however, elasticities vary widely between studies.
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Section 1.2 Elasticities - simulations and activities.
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Elasticity along a straight line demand curve.1.1 Competitive markets - simulations and activities.1.1 Competitive Markets: Demand and Supply - notes.1.1 Competitive Markets: Demand and Supply.Topic pack - Microeconomics - introduction.