If demand for personal computers increases as a result of an increase in income, a. personal computers must be a normal good b. personal computers must be an inferior good c. personal computers must be a complement d. the substitutes for personal computers must be inferior goods e. the substitution effect is larger than the income effect

Question

Hillary

Business

11 January, 00:13

If demand for personal computers increases as a result of an increase in income, a. personal computers must be a normal good b. personal computers must be an inferior good c. personal computers must be a complement d. the substitutes for personal computers must be inferior goods e. the substitution effect is larger than the income effect

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Franklin Watson · Answer 1

Answer: Personal computers must be a normal good.

Explanation:

Normal good is a type of commodity available in a market, in which the commodity's demand increases as income of the buyers increase. The normal goods posses a positive income elasticity of demand (where demand is directly proportional to income).