If income elasticity of demand for a good is negative, the good is a(n) __________ good.
A)normal
B)positive
C)complementary
D)substitute
E)inferior

Question

Quizplus · Accepted Answer

When the income elasticity of demand for a good is negative, it means that as income increases, the demand for the good decreases. This characteristic is typical of inferior goods, as consumers tend to buy less of these goods when their income levels rise, opting instead for higher-quality or more expensive alternatives.

If Income Elasticity of Demand for a Good Is Negative