As the economy recovers from a recession, we should expect that demand for:

Question

Quizplus · Accepted Answer

During a recession, consumers tend to shift towards cheaper alternatives and the demand for inferior goods (lower quality and lower-priced goods) increases while the demand for non-inferior goods (higher quality and higher-priced goods) decreases. As the economy recovers, consumers are likely to go back to spending on non-inferior goods, causing the demand for inferior goods to fall and the demand for non-inferior goods to rise. Therefore, choice A is the correct answer.

As the Economy Recovers from a Recession, We Should Expect