In order to prove that macaroni is an inferior good, we could test the _____ of macaroni and get a _____.
A)cross-price elasticity; negative number.
B)income elasticity; number less than 1.
C)income elasticity; positive number.
D)price elasticity of demand; number greater than negative 1.
E)income elasticity; negative number.

Question

In order to prove that macaroni is an inferior good, we could test the _____ of macaroni and get a _____.​
A)cross-price elasticity; negative number.
B)income elasticity; number less than 1.
C)income elasticity; positive number.
D)price elasticity of demand; number greater than negative 1.
E)income elasticity; negative number.

Quizplus · Accepted Answer

An inferior good is one where demand decreases as income increases. This is indicated by a negative income elasticity of demand.

In Order to Prove That Macaroni Is an Inferior Good