Question

Over time, some goods change from being a normal good to an inferior good, or from being an inferior good to a normal good. One example is a CRT television, also known as a tube television. In the 1980s, households with more income usually purchased CRT TVs. Today, more CRT TVs are purchased by households with less income. What has happened to CRT TVs? Choose one:A. CRT TVs have become obsolete.B. A CRT TV has become an inferior good because people buy more of this type of TV when they have lower incomes.C. A CRT TV has become a normal good because buyers now believe it to be of a lower quality than other types of TV.D. A CRT TV has become an inferior good because as consumers gain more purchasing power, they purchase more of the product.

Answer 1

B. A CRT TV has become an inferior good because people buy more of this type of TV when they have lower incomes. BUT THE REASON THEY BECAME AN INFERIOR GOOD IS BECAUSE THEY ARE OBSOLETE.

Step-by-step explanation:

CRT TVs are like cameras that used photographic film, they are completely obsolete. They are currently sold only on some Asian and African countries as very cheap TVs. Before everyone I knew had a CRT TV, because it was the only TV available and they were very expensive. Now people buy smart TVs and they keep getting bigger every time. There are no smart CRT TVs, so they are obsolete and then they turned into an inferior good.

Answer 2

B. A CRT TV has become an inferior good because people buy more of this type of TV when they have lower incomes

Step-by-step explanation:

Inferior goods are goods that consumers demand less as their income increases while normal goods are goods whose demand increases as a consumer income rises.

A CRT TV is inferior because as consumer income rises its demand falls. The fall in demand is as a result of consumer demanding for more quality TV like LCD. So demand for A CRT will only rise as consumer income falls, but if the consumer should rise, the demand for A CRT TV will fall as they go for advanced TV like LCD.

So option B is right.