Income Effect on Inferior Goods Shifts Demand Right

Steps:

• Demand curve shifts right when quantity demanded increases at every price.
• Shifts result from non-price factors like income changes; price changes cause movement along the curve.
• Inferior goods have inverse income-demand relationship: lower income boosts demand.
• Income decrease for inferior good thus increases demand, shifting curve right.

Why A is correct:

• For inferior goods, income decrease raises demand as consumers buy more low-quality substitutes, per the income effect definition.

Why the others are wrong:

• B: Price decrease moves down along the existing demand curve, no shift.
• C: Normal good with income decrease reduces demand, shifting curve left.
• D: Price decrease causes movement along the curve, not a shift.

Final answer: A