Jaime is currently consuming some of good X and some of good Y.If good Y is a normal good for this consumer,a rise in her income will definitely cause her to
A) increase her consumption of X.
B) increase her consumption of Y.
C) decrease her consumption of X.
D) decrease her consumption of Y.

Question

Quizplus · Accepted Answer

A normal good is a good for which an increase in income leads to an increase in demand. If good Y is a normal good for the consumer, then a rise in her income will cause her to increase her consumption of good Y. This is because the consumer will have more disposable income, and as good Y is a normal good, she will want to consume more of it. The rise in income may also lead to an increase in demand for good X, but this is not definite as we do not know whether good X is a normal good, inferior good, or a luxury good.

Jaime Is Currently Consuming Some of Good X and Some