If Edma buys more pasta when the price of pasta increases, we can infer that for Edma

1. pasta is a normal good when the income effect exceeds the substitution effect.

2. pasta in a normal good for which the substitution effect exceeds the income effect.

3. pasta is an inferior good when the income effect exceeds the substitution effect.

4. pasta in an inferior good for which the substitution effect exceeds the income effect.

The change in quantity demand is due to a change in the consumer’s income, i.e., real income is captured by the income effect. The inferior good’s demand increases when the consumer’s income falls, and the normal good demand increases when the income of the consumer increases.

For example, suppose Alex consumes two goods, wheat flour and jowar flour. When his income increases, the demand for wheat will rise as wheat flour is a normal good, and demand for jowar will fall as it is an inferior good to Alex.

The substitution effect is when the price increases, then the demand for that product decreases as the consumer demands shift to some low-price product.

For example, suppose the price of wheat flour increases and jowar flour price does not change, then due to substitution effect, the consumer will shift the consumption to jowar flour as jowar is cheaper than wheat.

If, with an increase in pasta price, Edma is buying more pasta, it means the good is inferior. A higher price reduces the relative income or real income of Edma, increasing the demand for pasta. Here, the income effect is greater than the substitution effect.