A. The price of good 1 increased and the goods are complements B. The price of good 2 decreased and the goods are complements C. The price of good 1 decreased and the goods are substitutes D. The price of good 2 decreased and the goods are substitutes E. The individual's income decreased and good # 1 is inferior and good #2 is normal F. The individual's income increased and good #2 is inferior and good #1 is normal

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Normal and Inferior Goods

Understanding a normal good and an inferior good is important because it tells us what will happen to demand different products during booms and recessions.