If the demand for potatoes increases whenever a person's income increases, then potatoes are an example of _____.

Study for the VirtualSC Economics Honors Exam. Utilize flashcards and multiple-choice questions, each with hints and explanations. Get prepared for your exam!

The correct choice is that potatoes are an example of normal goods. This classification is based on the relationship between demand and consumer income. When income rises, consumers tend to buy more of normal goods because these items are perceived as desirable or of higher quality. As people's purchasing power increases, their demand for these goods increases, reflecting their ability to afford more or better-quality products.

In contrast, inferior goods are those for which demand decreases as income rises, meaning consumers will opt for alternatives that they perceive as superior or more desirable when they have more financial resources. Complementary goods are products that are typically consumed together, while substitute goods are those that can replace each other; an increase in the demand for one usually leads to an increase in the demand for the other due to their interchangeable nature. Potatoes, in this case, do not fall into those categories; they become more sought after as income increases, confirming their status as normal goods.

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