Which term refers to goods that consumers demand more of when their incomes rise?

The correct answer is the term that refers to goods for which demand increases as consumer incomes rise, which is known as normal goods. Normal goods have a positive relationship with income changes; when people have more money, they tend to buy more of these goods because they might perceive them as higher quality or more desirable.

For example, consider everyday products like organic food, luxury items, or brand-name clothing. As consumers' incomes increase, their purchasing power expands, allowing them to buy more of these goods that enhance their lifestyle. This behavior makes normal goods distinct from inferior goods, which see an increase in demand when incomes fall as consumers opt for cheaper alternatives.

Understanding the difference between normal goods and inferior goods is crucial in microeconomics, as it helps analyze consumer behavior in response to economic changes, income levels, and market demand.