Which of the following will cause the demand for a normal good to increase?

• A. An increase in the price of the good itself
• B. A decrease in the price of a substitute good
• C. An increase in consumer income
• D. A decrease in consumer population

Answer: (C)

Verified step by step guidance

1. Understand the definition of a normal good: A normal good is one for which demand increases when consumer income rises, and decreases when consumer income falls.
2. Analyze the effect of an increase in the price of the good itself: According to the law of demand, an increase in the price of a good typically causes a decrease in quantity demanded, not an increase in demand.
3. Consider the impact of a decrease in the price of a substitute good: If a substitute good becomes cheaper, consumers may switch to that substitute, causing the demand for the original good to decrease, not increase.
4. Evaluate the effect of an increase in consumer income: For a normal good, higher income means consumers can afford more, so the demand curve shifts to the right, indicating an increase in demand.
5. Assess the effect of a decrease in consumer population: Fewer consumers generally lead to a decrease in demand for most goods, including normal goods.