Question: In this question, the correct answer is D, however, I don't understand why it is the case. More specifically, how do we make the connection
In this question, the correct answer is D, however, I don't understand why it is the case. More specifically, how do we make the connection between normal and inferior goods to price elasticity ? This is the part that I don't understand.
Thanks

34. For Sara, ramen noodles are a normal good, however Sean considers ramen noodles to be inferior. If Sara and Sean have the same amount of income: A) Sean's income effect will be stronger than Sara's income effect. B) Sean's substitution effect will be stronger than Sara's substitution effect. C) Sean's demand for ramen noodles will be more price elastic than Sara's. D) Sean's demand for ramen noodles will be less price elastic than Sara's
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
