How does an increase in consumer income typically affect the demand curve for normal goods, and what is the underlying reason for this shift?

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Seekh · Accepted Answer

When consumers earn more, they can afford to buy more of normal goods, so the demand curve shifts to the right. This happens because the extra income raises each buyer’s purchasing power, making the good more attractive at every price level. Consequently, at every price, the quantity demanded increases. For example, if a family’s income rises from $30,000 to $40,000, they might buy 10 more units of a normal good like coffee at each price point.

How does an increase in consumer income typically affect the demand curve for normal goods, and what is the underlying reason for this shift?

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