A Turnip Is an Inferior Good If

question 60

Multiple Choice

A turnip is an inferior good if

• A)an increase in income increases the demand for turnips.
• B)an increase in income decreases the demand for turnips.
• C)turnips violate the law of demand.
• D)an increase in the price of a turnip decreases the quantity of turnips that consumers want to buy.
• E)turnips are a low quality good.

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Definitions:

Socialist Systems

Political and economic theories advocating for the ownership and administration of the means of production and distribution by the community as a whole or by a centralized government to achieve equal distribution of wealth and the elimination of social classes.

Mixed Economy

A system where both private enterprise and government intervention coexist in the economic sphere, facilitating a balance between free market principles and social welfare.

Invisible Hand

A term coined by Adam Smith to describe the unintended social benefits resulting from individual actions in a free market.

Price Mechanism

The process by which the forces of supply and demand determine the prices of goods and services in a market economy.