-In the above figure, income is $8, the price of a soft drink is $1, and the initial price of a milkshake is
$2) If the price of a milkshake decreases to $1, milkshakes are revealed to be
A) less preferred than soft drinks.
B) an inferior good.
C) a normal good.
D) None of the above answers is correct.

Question

-In the above figure, income is $8, the price of a soft drink is $1, and the initial price of a milkshake is
$2) If the price of a milkshake decreases to $1, milkshakes are revealed to be
A) less preferred than soft drinks. 
B) an inferior good. 
C) a normal good. 
D) None of the above answers is correct.

Quizplus · Accepted Answer

When the price of a milkshake decreases and the consumer buys more milkshakes, it indicates that milkshakes are a normal good, as the consumer's demand for them increases with a decrease in price.

-In the Above Figure, Income Is $8, the Price of a Soft