If the demand for a normal good (for example, steak) shifts to the left, the most likely reason is that A

Economics Dec 08, 2020

If the demand for a normal good (for example, steak) shifts to the left, the most likely reason is that

A. the price of steak has risen.

B. consumer incomes have fallen.

C. cattle production has declined.

D. the price of cattle feed has gone up.

Expert Solution

Option B (consumer incomes have fallen) is the correct answer.

When there is a fall in the income of a consumer, the purchasing power of the consumer to buy goods and services is reduced, it means that the person will be able to consume less than before. This leads to a leftward shift in the demand for normal goods.

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