Answer to Question #85118 in Microeconomics for Ayanda Lubisi

Question #85118
The income elasticity of an inferior good is …

1. negative because as people become richer, they increase their purchases of the
good by smaller and smaller amounts.
2. 1 because the increased income offsets the desire to consume less of the good
because it is inferior.
3. greater than 1 because the richer you become, the less you will consume of the
good.
4. negative because higher income leads to a reduction in the amount consumed of the
product.
1
Expert's answer
2019-02-21T14:36:07-0500

4. negative because higher income leads to a reduction in the amount consumed of the product.


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