Match List I with List II
| List I | List II |
| A. Nominal goods | I. These goods are consumed together |
| B. Inferior goods | II. Demand for the good decreases as income of the consumer increases |
| C. Substitute goods | III. These goods are used in place of each other |
| D. Complementary goods | IV. Demand for the good increases as income of consumer increases |
Choose the correct answer from the options given below :
Answer & explanation
Correct answer: option 3
The correct answer is option (3) : A-IV, B-II, C-III, D-I
| List I | List II |
| A. Nominal goods | IV. Demand for the good increases as income of consumer increases |
| B. Inferior goods | II. Demand for the good decreases as income of the consumer increases |
| C. Substitute goods | III. These goods are used in place of each other |
| D. Complementary goods | I. These goods are consumed together |
Let's break down the matches :
A-IV : Normal goods have a direct relationship with income; as income increases, demand for normal goods increases.
B-II : Inferior goods have an inverse relationship with income; as income increases, demand for inferior goods decreases.
C- III : Substitute goods are used in place of each other, so they are consumed together.
D-I : Complementary goods are consumed together; the demand for one is related to the demand for the other.