Which of the following statements is true?
A. In case of inferior goods, the income effect is negative, although the substitution effect is positive.
B. In inferior goods, the income and substitution effects are positive.
C. In inferior goods, the income and substitution effects are negative.
D. In case of inferior goods, the income effect is positive although the substitution effect is negative.
Answer:A
Which of the following statements is true?
A. In case of inferior goods, the income effect is negative, although the substitution effect is positive. B. In inferior goods, the income and substitution effects are positive. C. In inferior goods, the income and substitution effects are negative. D. In case of inferior goods, the income effect is positive although the substitution effect is negative.