An Inferior Good Is

question 157

Multiple Choice

An inferior good is

• A)any good that consumers think is of low quality.
• B)a good for which the quantity demanded increases as its price decreases.
• C)a good for which the demand rises as income falls.
• D)a good for which the demand rises as income rises.
• E)any good that a producer cannot sell a large quantity of, even at a low price.

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Definitions:

Adjustment Costs

Expenses incurred from making changes to a business, such as restructuring operations or relocating facilities.

Marketable Securities

Short-term financial instruments that can be quickly converted into cash at a reasonable price, like stocks and bonds.

Treasury Bill

A short-term government security issued at a discount from the face value and pays no interest.

Commercial Paper

An unsecured, short-term debt instrument issued by corporations, typically for financing accounts receivable and inventories.