Nico rents 10% more DVDs when his income increases by 20%.Based on this information,we know that DVDs:
A)are a normal good.
B)are an inferior good.
C)have many substitutes.
D)have come down in price.

Question

Quizplus · Accepted Answer

If Nico rents 10% more DVDs when his income increases by 20%, this means that the demand for DVDs increases as income increases. This is characteristic of normal goods, where there is a positive relationship between income and demand for the good. Therefore, DVDs are a normal good.

Nico Rents 10% More DVDs When His Income Increases by 20%.Based