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What is a normal good? A normal good describes all goods and services for which demand increases when income increases. When you're a student, your income is

What is a normal good?

A normal good describes all goods and services for which demand increases when income increases.

When you're a student, your income is typically very limited. But after graduating and getting a job, your income goes up – and the types of goods and services you demand are probably going to change. You may buy a new car, get a nicer apartment or purchase your first house, and start eating out at nicer restaurants. These are all examples of normal goods.

Now what happens to the demand for normal goods during an economic boom? Or what about a recession? We’ll explore how both of these situations affect the demand for normal goods in the video.

Want to learn more about demand and how people make choices about consumption? Check out our Micro sections on Supply, Demand, and Equilibrium and Consumer Choice.

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