A-LevelEconomicsThe price system and the microeconomy9708/12 · May/June 2016 · Q81 Mark

It has been estimated that bread has an income elasticity of –0.04. What can be concluded about bread from this information?

AIt is a normal good.

BIt is an inferior good.

CIt has many complements.

DIt has many substitutes.

✓ Correct answer

B: It is an inferior good.

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Topic: The price system and the microeconomy, A-Level Economics (syllabus 9708). Multiple choice, 1 mark.
Source: A-Level Economics, May/June 2016 Paper 1 Variant 2, question 8.

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