A good is inferior good for one & at the same time, normal goods for another consumer. Do you agree ? explain.
Swati,
Yes, I agree with the given statement that 'A good is an inferior good for one and at the same time normal good for another consumer'. A good can be normal or inferior depending on the level of consumer's income. For instance, at a very low level of income, coarse cereals may be a normal good. However, for higher income level, ceteris paribus, coarse cereals will be an inferior good because with an increase in income, a consumer will reduce his/her consumption of inferior cereals and it will be substituted by superior cereals.
Yes, I agree with the given statement that 'A good is an inferior good for one and at the same time normal good for another consumer'. A good can be normal or inferior depending on the level of consumer's income. For instance, at a very low level of income, coarse cereals may be a normal good. However, for higher income level, ceteris paribus, coarse cereals will be an inferior good because with an increase in income, a consumer will reduce his/her consumption of inferior cereals and it will be substituted by superior cereals.