Assuming that the supply of an inferior good does not change, a decrease in the consumer's income will decrease the equilibrium price and quantity of the good.

Question

Quizplus · Accepted Answer

A decrease in consumer's income typically increases the demand for inferior goods (since consumers switch from more expensive goods to less expensive, inferior ones), which can lead to an increase in both the equilibrium price and quantity, assuming supply remains constant.

Assuming That the Supply of an Inferior Good Does Not