Asked by Theresa Quinn on May 02, 2024
Verified
After graduation many students' demand for used cars decreases.This may be because used cars are considered a normal good to college graduates.
Normal Good
An item whose demand grows when the income of consumers goes up, and diminishes when their income goes down.
Used Cars
Pre-owned vehicles that have had one or more retail owners, sold through various outlets including dealerships and private sales.
- Discern the relationship between income alterations and the demand dynamics for normal versus inferior goods.
Verified Answer
ZK
Zybrea KnightMay 05, 2024
Final Answer :
False
Explanation :
The decrease in demand for used cars after graduation is likely because used cars are considered an inferior good to college graduates, who may now have higher incomes and prefer newer or higher-quality vehicles.
Learning Objectives
- Discern the relationship between income alterations and the demand dynamics for normal versus inferior goods.