Which of the following describes an inferior good? A. When consumer income increases, the demand for tea increases. B. When consumer income decreases, the demand for public transit decreases. C. When consumer income increases, the demand for eggs decreases. D. When consumer income decreases, the demand for aspirin is unchanged.

Question

Business

Kevin Wong

14 July, 00:57

Which of the following describes an inferior good? A. When consumer income increases, the demand for tea increases. B. When consumer income decreases, the demand for public transit decreases. C. When consumer income increases, the demand for eggs decreases. D. When consumer income decreases, the demand for aspirin is unchanged.

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Answers (1)

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Aimee · Answer 1

C. When consumer income increases, the demand for eggs decreases

Explanation:

An inferior good is an economic term used to describe products and services whose demand is inversely proportional to the people's income. As consumer's income increase, the demand for inferior goods decreases. Improvements in economic conditions in a country also make the demand for inferior goods to decrease.

Inferior goods are associated with consumers in the lower-income groups. Should their income increase, they will prefer more costly products. The term inferior goods is a purely economic term and have nothing to do with the quality aspects of a product.