If a consumer's preferences for two goods, say food and clothing, are such that as income increases, consumption of food and clothing both increase, we can say that:
A)food and clothing are inferior goods.
B)food is a normal good and clothing is an inferior good.
C)food is an inferior good and clothing is a normal good.
D)food and clothing are both normal goods.

Question

Quizplus · Accepted Answer

If consumption of both goods increases as income increases, both goods are classified as normal goods. If both goods increase as income increases, it indicates that both goods are normal goods.

If a Consumer's Preferences for Two Goods, Say Food and Clothing