Asked by
Mark Lester Siapno
on Dec 11, 2024Verified
If bus travel is an inferior good, then its income elasticity of demand will be
A) strictly greater than one.
B) positive.
C) equal to zero.
D) negative.
Income Elasticity
A measure of how the demand for a good or service changes in response to changes in consumers' income.
Inferior Good
A type of good for which demand decreases when the income of the consumer increases, inversely related to consumer income.
- Outline the distinctions among normal, inferior, and luxury goods based on the income elasticity of their demand.
Verified Answer
CP
Learning Objectives
- Outline the distinctions among normal, inferior, and luxury goods based on the income elasticity of their demand.