Which of the following correctly describes the price and income elasticity of demand for a normal good?

Show Answers

Demand's price elasticity is negative, and income elasticity is also negative.Demand's price elasticity is positive, while income elasticity is negative.Demand's price elasticity is negative, and income elasticity is positive.Both price elasticity and income elasticity of demand are positive.None of the above.

Explanation

For a normal good, the quantity demanded decreases as price rises, resulting in a negative price elasticity of demand. Additionally, demand increases as consumer income rises, which means the income elasticity of demand is positive.