Inferior good

Related BrainMass Solutions

• equilibrium price and quantity

  Therefore chicken is a normal good. However, when a decrease in incomes causes an increase in the demand of a good, the good is an inferior good. That is, people will consume more inferior good when they have less money.

• Inferior Good

  Yes, if the cheese pizzas are inferior goods, then the 15-yr old will be indifferent. An inferior good is a good that decreases in demand when consumer income rises, unlike normal goods, for which the opposite is observed.

• Why are there differences between normal and inferior goods?

  This is because people are afraid to make luxury or bigger item purchases when the future expectation of the economy is not good. I hope this gives you a better understanding of the concept. Good luck!

• Comparative Statics - Supply & Demand Curves

  The word "inferior" is not a reference to Y's quality. It merely means that as income increases, demand for the inferior good decreases, and vice versa, i.e. income and demand are inversely related.

• Normal and Inferior goods

  Mobile phone, Luxury cars, movies etc are good examples of normal goods. 2. What are "inferior" goods? Give an example in our current economy.

• Consumer Spending and Consumption

  Assume good X is a normal good and good Y is an inferior good. a. Income doubles Consumption of good X will INCREASE and consumption of good Y will DECREASE.

• Normative Statements and Inferior Goods

  A is incorrect because an inferior good is a good that increases in demand when the consumers income falls.

• Equilibrium price and quantity change

  Which good is inferior and which is normal? Explain your reasons. (b)How will the equilibrium price and quantity change for each good?

• Usual Utility Maximization

  With a normal good, a consumer will buy more as his income increases. With an inferior good, a consumer buys less as his income increases.