If the income elasticity of demand of a good is positive, we can conclude that the good is:
A) a normal good.
B) an inferior good.
C) a substitute.
D) a complement.

Question

Quizplus · Accepted Answer

A positive income elasticity of demand indicates that as income increases, the demand for the good also increases. This is the characteristic of a normal good, which is a good that people tend to buy more of as their income increases.

If the Income Elasticity of Demand of a Good Is