For a normal good,an increase in consumer income will lead to
I.A movement down 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 will lead to an outward shift in the demand curve for a normal good because consumers will be willing and able to buy more of the same product at every price. This is because their purchasing power has increased. There is no direct relationship between consumer income and supply, so option III is incorrect. Movement down the demand curve occurs with a decrease in price, not an increase in income, so option I is incorrect.

For a Normal Good,an Increase in Consumer Income Will Lead