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YED (Why does a firm wish to know about YED? (Sales forecastig, Non…

- - - - If income increases, demand increases (and vice versa)
        
        Normal necessities have an income elasticity of demand of between 0 and +1
        
        Mass transport (bus and rail)
        
        Staple food products such as bread, vegetables and frozen foods
        
        Beer and takeaway pizza
        
        Luxury goods and services have an income elasticity of demand > +1
        
        Consumer durables - audio visual equipment, smart-phone
        
        Sports cars
        
        Luxury holidays
    - - If income increases, demand falls.