Income Elasticity Classifications
Inferior
Demand and income change in opposite directions. Examples: fast food, ramen noodles, macaroni and cheese...
Normal
Demand and income change in the same direction. Examples: clothing, housing, education...
Necessities
Normal goods for which demand changes by a smaller percentage than income. Examples: personal care products, school supplies...
Luxuries
Normal goods for which demand changes by a larger percentage than income. Examples: autos, housing, vacations...

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