How do inferior goods differ from economic "bads"?
A)The demand for economic "bads" falls at higher levels of income whereas the demand for inferior goods falls at higher prices.
B)Economic "bads" are commodities for which demand falls as price falls whereas for inferior goods,quantity demanded falls as more is consumed.
C)Economic "bads" are commodities for which less is preferred to more under all conditions whereas for inferior goods,demand falls only when income increases.
D)For economic "bads" marginal utility is positive but gradually diminishes whereas for inferior goods,utility is negative from the first unit of consumption.

Question

Quizplus · Accepted Answer

Economic "bads" are commodities for which less is always preferred to more, regardless of other conditions, while inferior goods are those for which demand decreases as consumer income increases, not because they are inherently undesirable but because consumers can afford better alternatives.

How Do Inferior Goods Differ from Economic "Bads