If the quantity demanded for a good rises as income rises then the income elasticity of demand for this good is ________ than 0, and the good is ________ good.
A)greater; an inferior
B)less; a normal
C)less; an inferior
D)greater; a normal

Question

Quizplus · Accepted Answer

If the quantity demanded for a good rises as income rises, then the income elasticity of demand for this good is greater than 0, indicating that the good is a normal one. If the quantity demanded falls as income rises, then the income elasticity of demand is less than zero, indicating that the good is an inferior one. Therefore, choice D is correct.

If the Quantity Demanded for a Good Rises as Income