Income Elasticity: Understanding Its Impact on Consumer Behavior and Economic Trends

Introduction

Income elasticity of demand (IED) is a crucial economic concept that measures how the quantity demanded of a good or service responds to changes in consumer income. This report aims to explore the implications of income elasticity on consumer behavior and broader economic trends. Understanding IED is essential for businesses and policymakers, as it provides insights into consumer spending patterns, informs marketing strategies, and shapes fiscal polic