A normal good is defined as a good
A) with a downward sloping demand curve.
B) for which demand increases when the price of a substitute rises.
C) for which demand increases when income increases.
D) for which demand increases when the number of demanders increases.
E) for which demand increases when the price of a complement falls.

Question

Quizplus · Accepted Answer

A normal good is a good for which the demand increases as income increases. This means that as people have more money to spend, they are willing to buy more of the good. Normal goods have a positive income elasticity of demand, meaning that as income increases, demand increases.

A Normal Good Is Defined as a Good