If Francis experiences a decrease in his income,we would expect that,as a result,Francis's demand for

Question

Quizplus · Accepted Answer

When there is a decrease in income, it is expected that the demand for normal goods will decrease. Normal goods are those that have a positive income elasticity of demand, which means that as income decreases, the demand for these goods also decreases. Luxury goods are a type of normal good, so their demand would also decrease. Inferior goods, on the other hand, have a negative income elasticity of demand and their demand would increase as income decreases. However, this is not one of the options given in the question. Therefore, the best choice is B.

If Francis Experiences a Decrease in His Income,we Would Expect