Normal goods
A)have positive income elasticity of demand.
B)have negative income elasticity of demand.
C)have negative elasticity of supply.
D)do not have elasticity of demand.
E)are sometimes also inferior goods.

Question

Quizplus · Accepted Answer

Normal goods have a positive income elasticity of demand, meaning that as income increases, the quantity demanded also increases. This indicates that normal goods are considered luxury goods, as consumers are willing to spend more on them as their income increases. Normal goods are also distinct from inferior goods, which have negative income elasticity of demand and are considered necessities with lower quality, such as generic or store-brand products.

Normal Goods