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Microeconomics

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Consumer Comparatives: Impossibly Inferior

MICRO-O01JC4

Goods cannot be inferior over the entire range of income. Why is this?

A

This is a necessary result because of the fact that marginal utility decreases.

B

If a good were inferior over the entire range of income, demand would be positive at zero income.

C

Because at some point, the preference for variety forces demand to rise with income.

D

This is incorrect, a good can be inferior over the entire range of income.