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Directions: In Econoville, there is one grocery shop, Ecoconvenience. It used to sell fresh milk at Rs. 20 per litre, at which price 400 litres of milk were sold per month. After some time, the price was raised to Rs. 30 per litre. Following the price rise:
Only 200 litres of milk was sold every month.
The number of boxes of cereal customers bought went down from 280 to 240.
The number of packets of powered milk customers bought went up from 90 to 220 per month.
The number of boxes of cereal customers bought went down from 280 to 240.
The number of packets of powered milk customers bought went up from 90 to 220 per month.
We can say that fresh milk in economics sense is a/an
- a)luxury good
- b)inferior good
- c)normal good
- d)Nothing can be said
Correct answer is option 'C'. Can you explain this answer?
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Most Upvoted Answer
Directions:In Econoville, there is one grocery shop, Ecoconvenience. I...
Explanation:
Definition of Normal Good: A normal good is a type of good whose demand increases when income increases and decreases when income decreases, while all other factors remain constant.
Analysis of the given information:
1. Before the price rise, 400 litres of fresh milk were sold per month at Rs. 20 per litre.
2. After the price rise, the price of fresh milk increased to Rs. 30 per litre, and only 200 litres of fresh milk were sold per month.
3. The decrease in the quantity demanded of fresh milk after the price rise indicates that fresh milk is a normal good. This is because when the price of a normal good increases, the quantity demanded decreases, assuming that all other factors remain constant.
4. The decrease in the number of boxes of cereal customers bought from 280 to 240 per month could be due to either an increase in the price of cereal or a decrease in consumer income. However, since the price of cereal is not given, it is not possible to determine whether cereal is a normal good, inferior good, or luxury good.
5. The increase in the number of packets of powdered milk customers bought from 90 to 220 per month could be due to either a decrease in the price of powdered milk or an increase in consumer income. However, since the price of powdered milk is not given, it is not possible to determine whether powdered milk is a normal good, inferior good, or luxury good.
Conclusion: Based on the given information, we can conclude that fresh milk in economics sense is a normal good.
Definition of Normal Good: A normal good is a type of good whose demand increases when income increases and decreases when income decreases, while all other factors remain constant.
Analysis of the given information:
1. Before the price rise, 400 litres of fresh milk were sold per month at Rs. 20 per litre.
2. After the price rise, the price of fresh milk increased to Rs. 30 per litre, and only 200 litres of fresh milk were sold per month.
3. The decrease in the quantity demanded of fresh milk after the price rise indicates that fresh milk is a normal good. This is because when the price of a normal good increases, the quantity demanded decreases, assuming that all other factors remain constant.
4. The decrease in the number of boxes of cereal customers bought from 280 to 240 per month could be due to either an increase in the price of cereal or a decrease in consumer income. However, since the price of cereal is not given, it is not possible to determine whether cereal is a normal good, inferior good, or luxury good.
5. The increase in the number of packets of powdered milk customers bought from 90 to 220 per month could be due to either a decrease in the price of powdered milk or an increase in consumer income. However, since the price of powdered milk is not given, it is not possible to determine whether powdered milk is a normal good, inferior good, or luxury good.
Conclusion: Based on the given information, we can conclude that fresh milk in economics sense is a normal good.
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Directions:In Econoville, there is one grocery shop, Ecoconvenience. It used to sell fresh milk at Rs. 20 per litre, at which price 400 litres of milk were sold per month. After some time, the price was raised to Rs. 30 per litre. Following the price rise:Only 200 litres of milk was sold every month.The number of boxes of cereal customers bought went down from 280 to 240.The number of packets of powered milk customers bought went up from 90 to 220 per month.We can say that fresh milk in economics sense is a/ana)luxury goodb)inferior goodc)normal goodd)Nothing can be saidCorrect answer is option 'C'. Can you explain this answer?
Question Description
Directions:In Econoville, there is one grocery shop, Ecoconvenience. It used to sell fresh milk at Rs. 20 per litre, at which price 400 litres of milk were sold per month. After some time, the price was raised to Rs. 30 per litre. Following the price rise:Only 200 litres of milk was sold every month.The number of boxes of cereal customers bought went down from 280 to 240.The number of packets of powered milk customers bought went up from 90 to 220 per month.We can say that fresh milk in economics sense is a/ana)luxury goodb)inferior goodc)normal goodd)Nothing can be saidCorrect answer is option 'C'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Directions:In Econoville, there is one grocery shop, Ecoconvenience. It used to sell fresh milk at Rs. 20 per litre, at which price 400 litres of milk were sold per month. After some time, the price was raised to Rs. 30 per litre. Following the price rise:Only 200 litres of milk was sold every month.The number of boxes of cereal customers bought went down from 280 to 240.The number of packets of powered milk customers bought went up from 90 to 220 per month.We can say that fresh milk in economics sense is a/ana)luxury goodb)inferior goodc)normal goodd)Nothing can be saidCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Directions:In Econoville, there is one grocery shop, Ecoconvenience. It used to sell fresh milk at Rs. 20 per litre, at which price 400 litres of milk were sold per month. After some time, the price was raised to Rs. 30 per litre. Following the price rise:Only 200 litres of milk was sold every month.The number of boxes of cereal customers bought went down from 280 to 240.The number of packets of powered milk customers bought went up from 90 to 220 per month.We can say that fresh milk in economics sense is a/ana)luxury goodb)inferior goodc)normal goodd)Nothing can be saidCorrect answer is option 'C'. Can you explain this answer?.
Directions:In Econoville, there is one grocery shop, Ecoconvenience. It used to sell fresh milk at Rs. 20 per litre, at which price 400 litres of milk were sold per month. After some time, the price was raised to Rs. 30 per litre. Following the price rise:Only 200 litres of milk was sold every month.The number of boxes of cereal customers bought went down from 280 to 240.The number of packets of powered milk customers bought went up from 90 to 220 per month.We can say that fresh milk in economics sense is a/ana)luxury goodb)inferior goodc)normal goodd)Nothing can be saidCorrect answer is option 'C'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about Directions:In Econoville, there is one grocery shop, Ecoconvenience. It used to sell fresh milk at Rs. 20 per litre, at which price 400 litres of milk were sold per month. After some time, the price was raised to Rs. 30 per litre. Following the price rise:Only 200 litres of milk was sold every month.The number of boxes of cereal customers bought went down from 280 to 240.The number of packets of powered milk customers bought went up from 90 to 220 per month.We can say that fresh milk in economics sense is a/ana)luxury goodb)inferior goodc)normal goodd)Nothing can be saidCorrect answer is option 'C'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Directions:In Econoville, there is one grocery shop, Ecoconvenience. It used to sell fresh milk at Rs. 20 per litre, at which price 400 litres of milk were sold per month. After some time, the price was raised to Rs. 30 per litre. Following the price rise:Only 200 litres of milk was sold every month.The number of boxes of cereal customers bought went down from 280 to 240.The number of packets of powered milk customers bought went up from 90 to 220 per month.We can say that fresh milk in economics sense is a/ana)luxury goodb)inferior goodc)normal goodd)Nothing can be saidCorrect answer is option 'C'. Can you explain this answer?.
Solutions for Directions:In Econoville, there is one grocery shop, Ecoconvenience. It used to sell fresh milk at Rs. 20 per litre, at which price 400 litres of milk were sold per month. After some time, the price was raised to Rs. 30 per litre. Following the price rise:Only 200 litres of milk was sold every month.The number of boxes of cereal customers bought went down from 280 to 240.The number of packets of powered milk customers bought went up from 90 to 220 per month.We can say that fresh milk in economics sense is a/ana)luxury goodb)inferior goodc)normal goodd)Nothing can be saidCorrect answer is option 'C'. Can you explain this answer? in English & in Hindi are available as part of our courses for CA Foundation.
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Here you can find the meaning of Directions:In Econoville, there is one grocery shop, Ecoconvenience. It used to sell fresh milk at Rs. 20 per litre, at which price 400 litres of milk were sold per month. After some time, the price was raised to Rs. 30 per litre. Following the price rise:Only 200 litres of milk was sold every month.The number of boxes of cereal customers bought went down from 280 to 240.The number of packets of powered milk customers bought went up from 90 to 220 per month.We can say that fresh milk in economics sense is a/ana)luxury goodb)inferior goodc)normal goodd)Nothing can be saidCorrect answer is option 'C'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
Directions:In Econoville, there is one grocery shop, Ecoconvenience. It used to sell fresh milk at Rs. 20 per litre, at which price 400 litres of milk were sold per month. After some time, the price was raised to Rs. 30 per litre. Following the price rise:Only 200 litres of milk was sold every month.The number of boxes of cereal customers bought went down from 280 to 240.The number of packets of powered milk customers bought went up from 90 to 220 per month.We can say that fresh milk in economics sense is a/ana)luxury goodb)inferior goodc)normal goodd)Nothing can be saidCorrect answer is option 'C'. Can you explain this answer?, a detailed solution for Directions:In Econoville, there is one grocery shop, Ecoconvenience. It used to sell fresh milk at Rs. 20 per litre, at which price 400 litres of milk were sold per month. After some time, the price was raised to Rs. 30 per litre. Following the price rise:Only 200 litres of milk was sold every month.The number of boxes of cereal customers bought went down from 280 to 240.The number of packets of powered milk customers bought went up from 90 to 220 per month.We can say that fresh milk in economics sense is a/ana)luxury goodb)inferior goodc)normal goodd)Nothing can be saidCorrect answer is option 'C'. Can you explain this answer? has been provided alongside types of Directions:In Econoville, there is one grocery shop, Ecoconvenience. It used to sell fresh milk at Rs. 20 per litre, at which price 400 litres of milk were sold per month. After some time, the price was raised to Rs. 30 per litre. Following the price rise:Only 200 litres of milk was sold every month.The number of boxes of cereal customers bought went down from 280 to 240.The number of packets of powered milk customers bought went up from 90 to 220 per month.We can say that fresh milk in economics sense is a/ana)luxury goodb)inferior goodc)normal goodd)Nothing can be saidCorrect answer is option 'C'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice Directions:In Econoville, there is one grocery shop, Ecoconvenience. It used to sell fresh milk at Rs. 20 per litre, at which price 400 litres of milk were sold per month. After some time, the price was raised to Rs. 30 per litre. Following the price rise:Only 200 litres of milk was sold every month.The number of boxes of cereal customers bought went down from 280 to 240.The number of packets of powered milk customers bought went up from 90 to 220 per month.We can say that fresh milk in economics sense is a/ana)luxury goodb)inferior goodc)normal goodd)Nothing can be saidCorrect answer is option 'C'. Can you explain this answer? tests, examples and also practice CA Foundation tests.
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