Question

Income elasticity of demand is ________________ for an inferior good, and is

_________ for a normal good that is income-elastic.
A. negative, less than one
B. negative, negative
C. negative, positive and greater than one
D. positive, positive and greater than one
E. positive, positive and less than one

Answer 1

Income elasticity of demand is negative and less than one for an inferior good, and positive and greater than one for a normal good that is income-elastic. Correct option is D.

Step-by-step explanation:

Income elasticity of demand is negative, less than one for an inferior good, and is positive, positive and greater than one for a normal good that is income-elastic.