Asked by Rahaf Aldabain on Jul 01, 2024
Verified
If the demand for coffee decreases as income decreases, coffee is a(n)
A) normal good.
B) inferior good.
C) substitute good.
D) complementary good.
Normal Good
A good for which demand increases when consumer income rises, and decreases when consumer income falls.
Inferior Good
A type of good whose demand decreases when consumer income rises, contrary to normal goods, which see increased demand as incomes rise.
- Grasp basic concepts of consumer behavior and market demand, including the law of demand and distinguishing between different types of goods.
Verified Answer
FP
Faheem ParachaJul 02, 2024
Final Answer :
A
Explanation :
Normal goods are those for which demand increases as income increases and decreases as income decreases. Since the demand for coffee decreases with a decrease in income, it is classified as a normal good.
Learning Objectives
- Grasp basic concepts of consumer behavior and market demand, including the law of demand and distinguishing between different types of goods.
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