If Incomes increase what would happen to demand for bus rides (an inferior good) in the market?

Start the question by defining what is an inferior good - An inferior good is a type of good for which demand declines as the level of income or real GDP in the economy increases. 

Since we are looking at an inferior good (bus rides) the quantity demanded will decline.

Why? As incomes increase and people become richer they will use more luxurious methods of transport e.g trains or buy cars instead of the bus.  Therefore on the graph representing the market demand I will now show the demand for bus rides decreasing. To do this the demand line would shift to the left as this shows a decrease in demand.

Related Business Studies A Level answers

All answers ▸

What is meant by the term 'marketing'?


Evaluate the impact that competition will have on Pizza Express.                  [15]


What is the Triple Bottom line?


To what extent do the long term sales of a company, such as Primark, revolve around international trading ?


We're here to help

contact us iconContact usWhatsapp logoMessage us on Whatsapptelephone icon+44 (0) 203 773 6020
Facebook logoInstagram logoLinkedIn logo
Cookie Preferences