Question : What will be the effect on inferior commodities when the income of the consumers rises?
Option 1: Negative effect
Option 2: Positive effect
Option 3: No effect
Option 4: First increase then decrease
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Correct Answer: Negative effect
Solution : The correct option is the Negative effect .
When people's incomes increase, the desire for lesser goods decreases. When the economy is weak or earnings are low, less-priced alternatives to more expensive things can be found.
The term "inferior goods" might apply to a particular product brand, a specific item or even a specific instance of how something happens (such as riding a bus as opposed to driving a new automobile).
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