Difference b/w normal goods and inferior …
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Posted by ?????? ???? . 5 years, 9 months ago
- 3 answers
Yogita Ingle 5 years, 9 months ago
Normal goods: these are any goods for which demand increases when income increases, and falls when income decreases but price remains constant, i.e. with a positive income elasticity of demand. Law of demand applies here.
Cars, diamonds, branded fashions, hi-tech products etc
Inferior goods: is a good whose quantity demanded decreases when consumer income rises. Law of demand does not apply. Income elasticity of demand for these goods becomes negative
Examples are cheaper cars or low quality goods.
Aditi Maurya 5 years, 9 months ago
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Ritika Mehra 5 years, 9 months ago
2Thank You