1
Question
What
do you mean by an ‘inferior good’? Give some examples.
What do you mean by an ‘inferior good’? Give some examples.
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Solution
Inferior
good: Those
goods that share an inverse relationship with their prices and with
the income of a consumer are called inferior goods. That is,
If
the price of a good (Px)
increases, then thedemand for good (Dx)
decreases.
If
a consumer’s income (M)
increases, then the demand
for good (Dx)
decreases.
Examples:
Coarse cereals, bidis
etc.
Inferior good: Those goods that share an inverse relationship with their prices and with the income of a consumer are called inferior goods. That is,
If the price of a good (Px) increases, then thedemand for good (Dx) decreases.
If a consumer’s income (M) increases, then the demand for good (Dx) decreases.
Examples: Coarse cereals, bidis etc.
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