The income elasticity of demand for food is roughly 1. Suppose a consumer's monthly income is $2,000, of which 20 percent is spent on food. If the income of this consumer doubles, the amount she'll spend on food will be

A) $400 per month.
B) $500 per month.
C) $800 per month.
D) $1,000 per month.

Income Elasticity

A measure of how much the quantity demanded of a good responds to a change in consumers' incomes.

Monthly Income

The total amount of income or earnings received by an individual or household in one month, including wages, salaries, benefits, and other sources.

Food

Nutritious substances that people or animals eat or drink to maintain life and growth.