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Which Statement Is True for an Inferior Good

Question 82

Multiple Choice

Which statement is true for an inferior good?


A) The substitution effect is positive;as price rises,consumption increases.
B) The income effect is absent;as income increases,consumption remains constant.
C) The income effect works in the opposite direction to the substitution effect.
D) The good is of poor workmanship.
E) The income effect works in the same direction as the substitution effect.

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