An increase in consumer income would lead to which of the following for a normal good?
I.a movement along the demand curve
II.an outward shift in the demand curve
III.an increase in supply

Question

Quizplus · Accepted Answer

An increase in consumer income would lead to an outward shift in the demand curve for a normal good, as consumers would be able and willing to purchase more of the good at each price level. It would not affect supply, so option III is incorrect, and there would not be a movement along the demand curve - this would only occur due to a change in the price of the good itself, not income levels.

An Increase in Consumer Income Would Lead to Which of the Following