If an increase in income leads to an increase in the demand for noodles, noodles must be
A)an inferior good
B)a normal good
C)a luxury good
D)a substitute good

Question

Quizplus · Accepted Answer

When an increase in income leads to an increase in the demand for a product, it is considered a normal good. In the case of noodles, they are a common and affordable food item, so as people's incomes rise, they are likely to purchase more noodles. This makes them a normal good. They are not considered a luxury good, as they are not typically associated with wealth or extravagance. They are also not an inferior good, as the demand does not decrease as income rises. Lastly, they are not a substitute good, as there is no indication that an increase in the price of another product would cause people to turn to noodles as a replacement.

If an Increase in Income Leads to an Increase in the Demand