Question

What would happen to the market demand curve for polyester suits, an inferior good, if consumers' incomes rose?

Short answer

With an increase in consumers' income, the market demand curve for polyester suits, an inferior good, would shift to the left, indicating a decrease in demand for the product.

Step-by-step solution

Define Inferior Good

An inferior good is a type of good where demand decreases as consumer income increases. This is an inverse relationship. When income rises, consumers tend to shift their demand towards more expensive, high-quality goods, thus decreasing the demand for inferior goods.

Consider income increase

In this situation, consumers' incomes have risen. Consequently, according to the definition of an inferior good, the market demand for these goods (in this case, polyester suits) should decrease.

Predict Market Demand Curve Shift

Since the demand for the polyester suits drops with an increase in income, the market demand curve for these suits will shift to the left. This shift to the left represents a decrease in demand.