For inferior commodities, income effect is

1.	For inferior commodities, income effect is
Answer» NEGATIVE For INFERIOR commodities, income effect is Negative. When PRICE of an inferior good FALLS, its negative income effect will tend to REDUCE the quantity purchased, while the substitution effect will tend to increase the quantity purchased.

Answer»

For INFERIOR commodities, income effect is Negative. When PRICE of an inferior good FALLS, its negative income effect will tend to REDUCE the quantity purchased, while the substitution effect will tend to increase the quantity purchased.

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