If a product is a normal good,then its income elasticity of demand is
A) zero.
B) positive.
C) negative.
D) indeterminate.
E) greater than 1.

Question

Quizplus · Accepted Answer

The income elasticity of demand measures the responsiveness of the quantity demanded to a change in income. If the product is a normal good, then as income increases, the demand for the product also increases. This means that the income elasticity of demand for the normal good is positive.

If a Product Is a Normal Good,then Its Income Elasticity