ECON 202 Lecture Notes - Lecture 4: Inferior Good, Normal Good
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Which means that increase in price causes an infinitely large decrease in qd. % decrease in quantity demanded > % increase in price. % decrease in quantity demanded is = % increase in price. % decrease in quantity demanded < % increase in price. Quantity demanded is the same at all prices (vertical slope) Smallest increase in price of good cause a large increase in quantity demanded of sub. Price of good increases, quantity demanded of sub increases. Price of good increases, the quantity demanded of other remains the same. Price of good increases, quantity demanded of complement decreases. % increase in quantity demanded > % increase in income. % increase in quantity demanded < % increase in income (but > 0) Increase in price causes infinite increase in quantity supplied. % increase in qs > % increase in price.
