An inferior good is a good for which the quantity demanded increases as its pric

Question

An inferior good is a good for which the quantity demanded increases as its price decreases. a good for which the demand rises as income rises. any good that a producer cannot sell a large quantity of. even at a low price. any good that consumers think is of low quality. a good for which the demand rises as income falls. Refer to Exhibit 3-4. A price of S6 in the market will result in a shortage of 10 units. surplus of 5 units. surplus of 10 units. shortage of 5 units. Refer to Exhibit 3-4. A price of $4 in the market will result in a surplus of 5 units. shortage of 10 units. shortage of 5 units. surplus of 10 units. none of the above Refer to Exhibit 3-4. At a price of $6 units will be exchanged. 20 10 15 5 Refer to Exhibit 3-4. At a price of $2_units will be exchanged. 5 15 20 10

Explanation / Answer

20. An inferior good is one the demand for which falls with an increaase in income of the buyer.

21. A surplus of 10 units. Excess supply in this case of 10

22. At $4 the market is in equilibrium and no shortage or surplus exist.

23. At a price of 6 demand is for 10 units and therefore only 10 units will be exchanged.

24. At a price of 2 the supply is 10 units but the demand is 20 units therefore only 10 units will be exchanged. There is shortage of supply and excess demand in the market.

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