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| 1. |
Explain how rise in income of a consumer affects the demand of a good. Give example. |
| Answer» SOLUTION :An INCREASE in income of the consumer LEADS to an increase in demand of the commodity in case of a normal good as the consumer now has more money to spend on the good whereas a DECREASE in income of the consumer leads to fall in demand of a normal good as the consumer now has LESS disposable income to spend on the good. | |