The income elasticity of demand for skiing trips to Vermont is greater than one.Thus a trip to Vermont for skiing is ________ good.
A) a normal
B) an inferior
C) a unit elastic
D) a price elastic
E) a price inelastic

Question

Quizplus · Accepted Answer

When the income elasticity of demand for a good is greater than 1, it is considered a normal good as an increase in income leads to a more than proportionate increase in demand for the good. In this case, when people's income increases, they are likely to spend more on leisure activities like skiing trips to Vermont. Therefore, a trip to Vermont for skiing is a normal good.

The Income Elasticity of Demand for Skiing Trips to Vermont