b. The graph shows that if good Y is inferior, good Xmust be normal.must also be inferior.must be a luxury good.may be normal or inferior. Individual and Market Demand - End of Chapter Problema. Suppose a consumer's income increases, resulting in an outward shift of her budget constraint from BCĮ to BC₂. Move theindifference curve to signify that good Y is an inferior good.Good YGood XBCBC2

In the field of economics, an inferior good refers to a product that experiences a decline in demand…

Answered: b. The graph shows that if good Y is…

b. The graph shows that if good Y is inferior, good X must be normal. must also be inferior. must be a luxury good. O may be normal or inferior.

Principles of Microeconomics

7th Edition

ISBN:9781305156050

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter21: The Theory Of Consumer Choice

Section: Chapter Questions

Problem 2CQQ

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Concept explainers

Normal and Inferior Goods

Understanding a normal good and an inferior good is important because it tells us what will happen to demand different products during booms and recessions.

Question

b. The graph shows that if good Y is inferior, good X
must be normal.
must also be inferior.
must be a luxury good.
may be normal or inferior.

Individual and Market Demand - End of Chapter Problem
a. Suppose a consumer's income increases, resulting in an outward shift of her budget constraint from BCĮ to BC₂. Move the
indifference curve to signify that good Y is an inferior good.
Good Y
Good X
BC
BC
2

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