There are only two goods for John to consume: food and clothing. If clothing is an inferior good for John when his income rises to $100,000, then food is
A) also an inferior good.
B) a normal good.
C) Either inferior or normal could be possible.
D) Not enough information
B
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Demand is income elastic if
A) a large percentage increase in income results in a small percentage increase in quantity demanded. B) a small percentage increase in income results in a large percentage increase in quantity demanded. C) an increase in income does not affect the quantity demanded. D) the good in question has close substitutes.
Most economists are in agreement that minimum wages cause unemployment and make some people worse off as a result. However, does that imply that it makes everyone worse off? Who might benefit?
What will be an ideal response?
Which of the following items is NOT a deficit item in the balance of payments?
A) imports of merchandise B) sales of domestic assets to foreigners C) purchases of gold from foreigners D) military spending abroad
Which of the following will limit the money creation process to an amount less than the potential amount?
What will be an ideal response?