Suppose the price of good X falls and the consumption of good X increases. From this we can infer that X is a(n) (i)
Normal good.(ii)
Inferior good.(iii)
Giffen good.
A)(i) only
B)(i) or (ii) only
C)(iii) only
D)(ii) or (iii) only

Question

Quizplus · Accepted Answer

When the price of a good falls and its consumption increases, it indicates that the good is either a normal or an inferior good, as both types of goods can exhibit this behavior. A Giffen good would see a decrease in consumption when its price falls.

Suppose the Price of Good X Falls and the Consumption