Define income effect – Microeconomics | Management Notes

Define income effect
Cardinal Utility Approach | Microeconomics
Management Notes

Ans) Income effect is defined as the change in equilibrium due to change in income of the consumer. It shows the effect of change in income to the quantity demanded. It is positive in case of normal goods ,negative in case of inferior goods and zero in case of neutral goods.

Post Your Comment Here

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.