Question

If cigarettes are an inferior good, then a rise in consumer income will:________

A. Shift the demand for cigarettes in and to the left, raising the equilibrium price of cigarettes, but lowering the equilibrium price.
B. Shift the demand for cigarettes in and to the left, lowering the equilibrium price and quantity of cigarettes.
C. Shift the supply of cigarettes in and to the left, raising the equilibrium price and quantity of cigarettes.
D. Shift the supply of cigarettes out and to right, increasing the equilibrium price of cigarettes but decreasing the equilibrium quantity.
E. Shift the supply of cigarettes in and to the left, increasing the equilibrium price of cigarettes, but lowering the equilibrium quantity.

Answer 1

b

Step-by-step explanation:

Inferior goods are goods whose demand falls when income rises and increases when income falls.

If income rises and cigarette is an inferior good, the demand for cigarettes would fall, this would shift the demand curve inward. As a result of the leftward shift, equilibrium price and quantity would fall

Please check the attached image for a graphical representation