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Value Added Method

Increase in c...

Question

Increase in consumer's real income will _____ his demand for inferior goods.

A

increase

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B

decrease

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C

not affects

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D

positively affect

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Solution

The correct option is B decrease
Inferior goods are the goods whose demand rises when consumers's real income decreases and whose demand falls when consumer's real income increases. Hence, increase in consumer's real income will decrease his demand for inferior goods.

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