An 'inferior good' is (a) which is a poor quality good (b) which is a low priced good (c) which has positive income effect (d) which is below income status of the consumer.
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An inferior good is a low-priced good that is slightly low in quality.
Explanation:
- An inferior good can be defined as a good which is generally low in price.
- However, the low price does not necessarily mean that the quality of the product is bad.
- These products are just enough good in quality and can be used for meeting the needs.
- And inferior good has a negative income effect because people purchase better quality goods when they have more income.
- Therefore B, which is a low-priced good is the correct answer.
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