If the income elasticity of demand for a good is negative, then the good is:
A) a luxury good
B) a normal good
C) a substitute good
D) an inferior good

Name: If the income elasticity of demand for a good is negative, then the good is: A) a luxury good B) a normal good C) a substitute good D) an inferior good
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Question

Quizplus · Accepted Answer

A negative income elasticity of demand indicates that as income increases, the demand for the good decreases, which characterizes an inferior good.

If the Income Elasticity of Demand for a Good Is