Identify the truthfulness of the following statements.
I. It is possible for an Engel curve to be positively sloped for a certain region of income and negatively sloped for another region.
II) The income elasticity of demand for a normal good is negative.
A) Both I and II are true.
B) Both I and II are false.
C) I is true; II is false.
D) I is false; II is true.

Question

Identify the truthfulness of the following statements. 
I. It is possible for an Engel curve to be positively sloped for a certain region of income and negatively sloped for another region.
II) The income elasticity of demand for a normal good is negative.
A) Both I and II are true.
B) Both I and II are false.
C) I is true; II is false.
D) I is false; II is true.

Quizplus · Accepted Answer

For statement I, it is possible for an Engel curve to be positively sloped for a certain region of income and negatively sloped for another region. This is because there may be different income ranges where the relationship between income and quantity demanded is different. For statement II, the income elasticity of demand for a normal good is positive, not negative.

Identify the Truthfulness of the Following Statements