IB Economics SL 2.5.7 Income Elasticity of Demand Questions
Practise IB Economics SL 2.5.7 by defining YED, calculating it from data and applying it to normal, inferior and sectoral goods.
- Syllabus
- First assessment 2022
- Course
- Economics SL
- Level
- SL
Exam points
- define income elasticity of demand and identify normal, inferior, income-elastic and income-inelastic demand
- calculate YED or the related percentage change from data, interpret the sign and magnitude, and distinguish YED from XED
- analyse how changing incomes affect demand for primary commodities, manufactured goods, services and firms using examples and evidence
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IB Economics SL 2.5.7 Income Elasticity of Demand Questions question 1
[Maximum number: 10]
Explain how a decrease in income might affect the demand for normal goods and the demand for inferior goods.
Answers may include:
- definitions of demand, normal good, inferior good
- diagram(s) to show a how a decrease in income affects the demand for a normal good and an inferior good
- explanation of how a decrease in income reduces the demand for normal goods and increases the demand for inferior goods
- examples of normal goods and inferior goods.
A maximum of [6] should be awarded if a candidate has only covered normal goods OR inferior goods.
Assessment Criteria
Part (a) 10 marks
Level 0 (0 marks): The work does not meet a standard described by the descriptors below.
Level 1 (1-3 marks): There is little understanding of the specific demands of the question. Relevant economic terms are not defined. There is very little knowledge of relevant economic theory. There are significant errors.
Level 2 (4-6 marks): There is some understanding of the specific demands of the question. Some relevant economic terms are defined. There is some knowledge of relevant economic theory. There are some errors.
Level 3 (7-8 marks): There is understanding of the specific demands of the question. Relevant economic terms are defined. Relevant economic theory is explained and applied. Where appropriate, diagrams are included and applied. Where appropriate, examples are used. There are few errors.
Level 4 (9-10 marks): There is clear understanding of the specific demands of the question. Relevant economic terms are clearly defined. Relevant economic theory is clearly explained and applied. Where appropriate, diagrams are included and applied effectively. Where appropriate, examples are used effectively. There are no significant errors.
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