Consumers' income declines and, as a result, the demand for margarine increases. Is margarine a normal or an inferior good? Explain
What will be an ideal response?
Margarine is an inferior good. An inferior good is one for which demand increases as income decreases, which describes the situation outlined for margarine in the question.
Economics
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In the market for reserves, if the federal funds rate is between the discount rate and the interest rate paid on excess reserves, an increase in the reserve requirement ________ the ________ for reserves and causes the federal funds interest rate to
rise, everything else held constant. A) decreases; demand B) increases; demand C) increases; supply D) decreases; supply
Economics