For a normal good:
A)the income effect is negative when the price decreases.
B)the income effect is zero when the price increases.
C)the income effect is positive when the price increases.
D)the income effect is negative when the price increases.

Question

Quizplus · Accepted Answer

For a normal good, when the price increases, consumers feel poorer, which is known as the negative income effect. This means they are likely to buy less of the good because their purchasing power has decreased.

For a Normal Good