Normal good

In economics, a normal good is a type of a good which experiences an increase in demand due to an increase in income. When there is an increase in a person's income, for example due to a wage rise, a good for which the demand rises due to the wage increase, is referred as a normal good. Conversely, the demand for normal goods declines when the income decreases, for example due to a wage decrease or layoffs.

Example of a normal good: As income increases from B1 to B3, the outward movement of utility curve I dictates that the quantity of good X1 increases in tandem. Therefore, X1 is a normal good. Put another way, the positively sloped income consumption curve demonstrates that X1 is normal. The Engel curve of X1 would also be positively sloped.