For a normal good, the quantity demanded
A) falls when income rises.
B) responds inversely to changes in income.
C) rises when income falls.
D) does not change when income rises or falls.
E) rises when income rises.

Question

Quizplus · Accepted Answer

For a normal good, the quantity demanded rises when income rises. This is because people have more money to spend, and therefore they are able to purchase more of the good. Conversely, if income falls, people have less money to spend, and they may not be able to purchase as much of the good.

For a Normal Good, the Quantity Demanded