As income rises the quantity purchased of normal goods ____ and the quantity purchased of inferior goods ____.

Question

Quizplus · Accepted Answer

As income rises, people tend to purchase more of normal goods, which are of higher quality and are preferred over inferior goods. Therefore, the quantity purchased of normal goods rises. In contrast, people tend to purchase less of inferior goods as their income rises, since they can afford better quality substitutes. Thus, the quantity purchased of inferior goods falls.

As Income Rises the Quantity Purchased of Normal Goods ____