  Income- and price-elasticity of demand quantify the responsiveness of markets
to changes in income, and in prices, respectively. Under the assumptions of
utility maximization and preference-independence (additive preferences),
mathematical relationships between income-elasticity values and uncompensated
own and cross price-elasticity of demand are here derived for bundle of goods,
using the differential approach to demand analysis. Key parameters are: the
elasticity of the marginal utility of income, and the average budget-share. The
proposed method can be applied to forecast the direct and indirect impact of
price changes, and of financial instruments of policy using available estimates
of the income elasticity of demand.
