Engel curve
In microeconomics, an Engel curve describes how household expenditure on a particular good or service varies with household income. There are two varieties of Engel curves. Budget share Engel curves describe how the proportion of household income spent on a good varies with income. Alternatively, Engel curves can also describe how real expenditure varies with household income. They are named after the German statistician Ernst Engel (1821–1896), who was the first to investigate this relationship between goods expenditure and income systematically in 1857. The best-known single result from the article is Engel's law which states that as income grows, spending on food becomes a smaller share of income; therefore, the share of a household's or country's income spent on food is an indication of their affluence. Shape Graphically, the Engel curve is represented in the first quadrant of the Cartesian coordinate system. Income is shown on the horizontal axis and the quantity demanded for the selected good or service is shown on the vertical. The attached figure shows the derivation process of the Engel curve in case of necessities. Panel (a) is an undifferentiated graph representing consumers' preferences for goods X and Y. The three parallel lines of Rs.300, Rs