Engel curve

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A curve showing the relation between income level and consumption of some good, at a given price. In a diagram with income on the horizontal axis and consumption on the vertical, the Engel curve for a good with unit income elasticity of demand is a ray through the origin. The Engel curve for a necessity with less than unit income elasticity is flatter than a ray through the origin; and that for a luxury with more than unit income elasticity is steeper.

Engel Curve

Subjects: Economics.

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