Question

After graduation from college, you will receive a substantial increase in your income from a new job. If you decide that you will purchase more T-bone steak and less hamburger, then for you hamburger would be considered as:
a. complementary good.
b. normal good.
c. inferior good.
d. substitute good.

Answer 1

Answer:

c. inferior good.

Explanation:

Inferior goods are items purchased buy a consumer as a result of his limited income such that when that consumer's purchasing power increases, he purchases other commodities in place of the one initially purchased.

Hence the  purchase more T-bone steak and less hamburger is an indication that hamburger is an inferior good to the consumer.