Elasticity - Income Elasticity of Demand

The fact that whether a good is normal or inferior depending on a consumer's level of income, is an important point. Very poor people, and very poor countries can't afford to treat many goods as inferior. The cheapest form of food may well be a normal good for someone who is undernourished.

Likewise, the very wealthy may treat goods as inferior that many of us treat as luxuries. At a certain point in one's wealth accumulation rather than vacation, one may purchase a permanent residence in a desirable location. One may hire a chef rather than dine out in fine restaurants.. etc.