Economics Elasticity Of Demand Questions
The concept of price elasticity of demand for inferior goods refers to the responsiveness of the quantity demanded of inferior goods to changes in their prices. In general, inferior goods are those for which demand decreases as consumer income increases. The price elasticity of demand for inferior goods is typically positive, indicating that as the price of an inferior good increases, the quantity demanded decreases. However, the magnitude of the price elasticity of demand for inferior goods is generally lower than that of normal goods, meaning that the change in quantity demanded is relatively less responsive to changes in price.