If there are only two goods,coffee and donuts,and coffee is an inferior good for a consumer,then:

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Quizplus · Accepted Answer

DInferior goods are those for which demand decreases as the consumer's income increases. The fact that coffee is an inferior good does not preclude donuts from also being an inferior good, as the classification depends on the consumer's preferences and income levels, not on the relationship between the two goods themselves. Therefore, donuts can indeed be an inferior good. However, the statement about donuts not being a Giffen good is not necessarily true based on the information given, as both inferior goods and Giffen goods are related to income and price changes, but the definition and conditions for a Giffen good are more specific and not directly addressed by the information provided about coffee being an inferior good.

If There Are Only Two Goods,coffee and Donuts,and Coffee Is