A normal good is one for which demand varies directly with household income. As income increases, consumers demand more of the normal good, and as income decreases, demand for the good also decreases. This is in contrast to an inferior good, for which demand varies inversely with household income.

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A Normal Good Is One

Question 30

Multiple Choice

A normal good is one

A) for which demand does not vary with household income.
B) that normal people consume.
C) that everyone normally consumes.
D) for which demand varies inversely with household income.
E) for which demand varies directly with household income.

Correct Answer: