Given a supply curve that is positively sloped and a demand curve for a normal good that is negatively sloped,an increase in income will result in:
A)an increase in equilibrium price and quantity.
B)a decrease in equilibrium price and an increase in equilibrium quantity.
C)a decrease in both equilibrium price and quantity.
D)an increase in equilibrium price and a decrease in equilibrium quantity.

Question

Quizplus · Accepted Answer

An increase in income will shift the demand curve to the right, leading to an increase in equilibrium price and quantity due to the positively sloped supply curve. This is because consumers will be willing and able to pay a higher price for the good at every quantity.

Given a Supply Curve That Is Positively Sloped and a Demand