An Inferior Good Is a Good for Which the Quantity

question 133

True/False

An inferior good is a good for which the quantity demanded decreases as the price increases, holding everything else constant.

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Definitions:

Transaction Balances

Cash kept on hand by a firm to pay normal daily expenses, such as employee wages and bills for supplies and utilities.

Marketable Securities

Temporary investment of “extra” cash by organizations for up to one year in U.S. Treasury bills, certificates of deposit, commercial paper, or Eurodollar loans.

Retained Earnings

Earnings after expenses and taxes that are reinvested in the assets of the firm and belong to the owners in the form of equity.