Asked by
Gabby Brown
on Oct 08, 2024
Verified
If the coefficient of income elasticity of demand is positive,the product is an inferior good.
Income Elasticity
A measure of how much the demand for a good or service changes in response to changes in consumer income.
Inferior Good
A type of good whose demand decreases when consumers' income increases, opposite to normal goods.
- Identify and differentiate between inferior and normal goods based on the income elasticity of demand.
Verified Answer
FF
Learning Objectives
- Identify and differentiate between inferior and normal goods based on the income elasticity of demand.