When income increases, the demand curve for X shifts rightward and the demand curve for Y
Shifts leftward. These shifts mean that

Question

Quizplus · Accepted Answer

When income increases, people tend to buy more of normal goods and less of inferior goods. Therefore, X's demand curve shifting rightward implies that X is a normal good, and Y's demand curve shifting leftward implies that Y is an inferior good.

When Income Increases, the Demand Curve for X Shifts Rightward