Assume That a 4 Percent Increase in Income Across the Economy

Multiple Choice

Assume that a 4 percent increase in income across the economy produces an 8 percent increase in the quantity demanded of good X. The coefficient of income elasticity of demand is

A) negative, and therefore X is an inferior good.
B) negative, and therefore X is a normal good.
C) positive, and therefore X is an inferior good.
D) positive, and therefore X is a normal good.