Identify the reason of rightward shift in demand curve of a normal good.
Answer & explanation
Correct answer: option 1
The correct answer is option (1) : Increase in income of consumer
Given the prices of other goods and the preferences of a consumer, if the income increases, the demand for the good at each price changes, and hence, there is a shift in the demand curve. For normal goods, the demand curve shifts rightward and for inferior goods, the demand curve shifts leftward.