If the prices of all goods increase by the same proportion as income,the quantity demanded of good X will
A)decrease.
B)increase.
C)remain unchanged.
D)change in a way that cannot be determined from the information given.

Question

Quizplus · Accepted Answer

If the prices of all goods increase by the same proportion as income, consumers' purchasing power remains the same. Therefore, the quantity demanded of good X will remain unchanged, assuming that there are no changes in consumer preferences, availability of substitutes, or other factors affecting demand.

If the Prices of All Goods Increase by the Same