A good is an inferior good if the consumer buys more of it when
A)his income rises.
B)the price of the good falls.
C)the price of a substitute good rises.
D)his income falls.

Question

Quizplus · Accepted Answer

An inferior good is a good for which demand decreases when income increases. In other words, consumers will buy less of it as their income rises. Therefore, the correct choice is D, as when income falls, the consumer may have to opt for lower-priced alternatives, which would mean purchasing more inferior goods.

A Good Is an Inferior Good If the Consumer Buys