If leisure is a normal good, then an increase in income will

Question

Quizplus · Accepted Answer

A normal good is a good for which there is a positive income elasticity of demand. In other words, as income increases, the quantity demanded of the good increases as well. Since leisure is a normal good, an increase in income will lead to an increase in the quantity demanded of leisure. As a result, the individual will allocate more time to leisure and less time to work. Therefore, choice A is the correct answer.

If Leisure Is a Normal Good, Then an Increase in Income