Asked by Ebba Maria Stillman on May 06, 2024
Verified
(Figure: Demand for Coconuts) Use Figure: Demand for Coconuts.If coconuts are a normal good and the income level of consumers falls,it will be represented in the figure as a:
A) shift from D1 to D2
B) movement from point A to point B
C) shift from D1 to D3
D) movement from point B to point C
Normal Good
a good for which demand increases as the income of consumers increases and falls when their income decreases, assuming all other factors are constant.
Income Level
The amount of monetary or material wealth that an individual, family, or group receives, usually quantified on an annual basis.
- Identify the role of substitutes and complements on market dynamics.
- Comprehend the effect of income changes on demand for normal and inferior goods.
Verified Answer
MM
michel muemboMay 13, 2024
Final Answer :
C
Explanation :
A decrease in income would cause a decrease in demand for coconuts, resulting in a leftward shift of the demand curve from D1 to D3.
Learning Objectives
- Identify the role of substitutes and complements on market dynamics.
- Comprehend the effect of income changes on demand for normal and inferior goods.
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