Supply and demand is developed. In this discussion you will focus on your personal, or family, demand for a product. Consider the products or services you or your family use on a regular basis.
a) Provide and discuss an example of an inferior good, where your consumption decreases as your income increases.
b) Provide and discuss an example where you have made a substitution as a result of the increase in the price of a good
(A) -- There are many examples that you could use to answer this question. As our income increases, we buy certain goods and stop consuming other goods. For example, as my income increases, I may buy steaks instead of hamburgers. I may buy more expensive seafood (lobster, perhaps), instead of buying canned tuna. My consumption of the goods I purchased with a lower income decreases because I am replacing those goods with higher priced goods. This is a common ...
This solution discusses examples of inferior goods and substitute goods. Several examples are provided.