Which of the following is a major determinant of price elasticity of demand?

  • A The price of the commodity
  • B Availability of factors of production
  • C The prices of factors of production
  • D Income of the consumers
jamb 2016economics

The correct answer is D. Income of the consumers

 The Proportion of Consumer’s Income Spent:

An important determinant of the elasticity of demand is how much it accounts for in a consumer’s budget. In other words, the proportion of a consumer’s income spent on a particular commodity also influences the elasticity of demand for it. The greater the proportion of income spent on a commodity, the greater will be generally its elasticity of demand, and vice versa.

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