Question

a good is classified as inferior if:
a. consumers buy less when the price rises.
b. consumers buy less when the price falls.
c. consumers buy more when income rises.
d. consumers buy less when income rises.

Explanation:

An inferior good is defined by its relationship with consumer income: demand for it decreases as consumer income increases, as consumers shift to higher-quality alternatives when they can afford them. Option a describes the law of demand (applies to most goods, not just inferior ones). Option b describes a Giffen good, a rare subset of inferior goods but not the general definition. Option c describes a normal good, the opposite of an inferior good.

Answer:

d. consumers buy less when income rises.