question archive If a demand for a good is inelastic and inferior, what should its income elasticity of demand be?

If a demand for a good is inelastic and inferior, what should its income elasticity of demand be?

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If a demand for a good is inelastic and inferior, what should its income elasticity of demand be?

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If a demand for a good is inelastic and inferior, its income elasticity of demand is negative.

Income elasticity of demand is used to determine whether a product is an inferior or a normal good. The inelastic demand for goods is based on the price elasticity of demand. An inferior product means that the consumer will be buying less of the product when the income is higher and vice versa. This is because an inferior good is considered to be of lower quality and cheaper than its other substitutes. The more income a consumer has, the more affordable the other substitute goods. Therefore, the quantity demanded of the other product will increase.