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In economics, normal goods are any goods for which demand increases when income increases, and falls when income decreases but price remains constant, i.e. with a positive income elasticity of demand.[1][2] The term does not necessarily refer to the quality of the good, but an abnormal good would clearly not be in demand, except for possibly lower socioeconomic groups.

In particular, when the price of a normal good is zero, the demand is infinite.

Depending on the indifference curves, the amount of a good bought can either increase, decrease, or stay the same when income increases. In the diagram below, good Y is a normal good since the amount purchased increases from Y1 to Y2 as the budget constraint shifts from BC1 to the higher income BC2. Good X is an inferior good since the amount bought decreases from X1 to X2 as income increases.

Examples include Holidays, Cars, diamonds, branded fashions, hi-tech products etc.

example of a normal good and an inferior good

See also[edit]

References[edit]


Original courtesy of Wikipedia: http://en.wikipedia.org/wiki/Normal_good — Please support Wikipedia.
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Normal and Inferior Goods

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77 news items

 
TheStreet.com
Wed, 01 Oct 2014 08:22:30 -0700

Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press ...
 
Reuters
Wed, 01 Oct 2014 01:44:50 -0700

Such contingency planning was normal good business practice and "does not indicate that the central bank, or the Kremlin, has changed its position", he said. Were oil to fall below $75 per barrel, the central bank could be inclined to back-track on its ...
 
TheStreet.com
Wed, 01 Oct 2014 12:18:45 -0700

Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press ...
 
TheStreet.com
Tue, 30 Sep 2014 12:45:28 -0700

Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press ...
 
SFGate (blog)
Mon, 29 Sep 2014 10:15:00 -0700

Well, maybe not so normal. Good thing we didn't have to pick the first half-second half spread. At any rate, the winner of our annual prediction contest is rubesandbabes, who got the A's 88-74 record on the nose (although like most of us, he had ...
 
TheStreet.com
Mon, 29 Sep 2014 06:52:30 -0700

Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press ...
 
Pakistan Today
Wed, 01 Oct 2014 10:09:23 -0700

As a result of this democratic process, disaster resilience becomes a “normal good” instead of “public good” which can be only accessed by rich and influential segments of the society. Every tier of the democratic governance, starting from the local ...
 
TheStreet.com
Mon, 29 Sep 2014 07:48:45 -0700

Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press ...
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