Changes in Utility from Income

Changes in income can impact our consumption choices. As one's income fluctuates, they may also get more joy out of some goods and less from others.

1. Identify two types of goods. One that, to you, is a normal good; the other that, to you, is an inferior good.
2. Explain why an increase in income would make you want to consume more of the normal good.
3. Explain why an increase in income would make you consume less of the inferior good.