Question

If the quantity demanded of a good falls by 2% when income rises by 10%, then: Group of answer choices demand is income-elastic. the good is normal. the good is inferior. Both A and C.

Answer 1

The good is inferior

Step-by-step explanation:

For instance, if the income of a consumer increases, his demand for cheap shoes and shirt decreases and the demand for expensive shoes and shirt increases. So, therefore, the cheap shirt and shoes are inferior goods in the instance. So, whenever quantity demanded of a good fall when the income rises, the goods is considered inferior goods.