Question

A rise in the income of the consumer x leads to a fall in the dd for that good by that consumer . what is good x called

Answer 1

Hey there!

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Answer -: Inferior good.

⇒ A rise in the income of the consumer X leads to a fall in the demand for that good by the consumer. The good X is called inferior good.

Explanation -:

✰ Inferior goods ✰

Inferior goods are low quality products and their demand decreases when the income of the consumer increases and vice versa. In other words, in case of inferior goods, there is an inverse relationship between demand and income of the consumer. When the income rises , the demand for inferior goods falls and when income falls, demand for inferior goods rises.

→ When X is an inferior goods -

If 'X' is an inferior goods like bajra, coarse cereals, an increase in the income of the buyers will decrease his demand for that commodity as buyers feel richer. He would like to have less of inferior goods. The demand curve of the commodity (inferior good) will shift to the left.