Definition 1: An Engel curve illustrates the relationship between quantity consumed and income.

Definition 2: Income elasticity of demand equals percent change in quantity demanded divided
by percent change in income.
Theorem: If the Engel curve is perfectly horizontal, then the income elasticity of demand for
Good Y equals zero.
Proof that Good Y is a free good:
Major Premise: If the endowment model is invalid, then Good Y is a free good.
Minor Premise: The endowment model is invalid.
Conclusion (by modus ponens): Good Y is a free good.
Proof of Minor Premise (by contradiction):
Suppose not. Suppose the endowment model is valid, i.e. we can give (or take
away) any amount of money or any amount of Good Y so as to make quantity
consumed constant. In addition, suppose the income elasticity of demand is not
zero, particularly that the income elasticity of demand is positive. Then as income
increases, the quantity demanded of Good Y increases. By the theorem and modus
tollens, the Engel curve is not perfectly horizontal. However, although the
quantity demanded rises with income, we may give or take away any amount of
Good Y for any income so as to make the quantity consumed of Good Y constant.
Hence, the Engel curve is perfectly horizontal. This is a contradiction. Thus, the
supposition is false, and so the endowment model is invalid.