What is a normal good?
a. A good whose demand increases when income decreases
b. A good whose demand decreases when income decreases
c. A good whose demand increases when price increases
d. Both B&C
b
You might also like to view...
Which of the following statements is correct?
I. When economists derive the aggregate demand curve, they are looking at the effect of the price level on one commodity only. II. Any non-price-level change that increases total planned real spending on domestic goods shifts the AD curve to the right. A) I only B) II only C) Both I and II D) Neither I nor II
The introduction of human capital to the Solow neoclassical growth model ________ the predicted rate of return on investment in rich countries relative to poor countries
A) increases B) reduces C) may either increase or reduce D) has no effect on
The only factor that can cause movement along the aggregate supply curve is the
a. labor force. b. capital stock. c. availability of resources. d. price level. e. All of the above are correct.
When externalities cause markets to be inefficient,
a. government action is always needed to solve the problem. b. private solutions can be developed to solve the problem. c. given enough time, externalities can be solved through normal market adjustments. d. there is no way to eliminate the problem of externalities in a market.