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Which of the following can cause an increase in demand:
Increase in the price of substitute goods
Decrease in the income in case of inferior goods
Both of the above
None of the above
Option (3) is correct. Explanation: Increase in the price of substitute goods leads to increase in the demand for other goods. Inferior goods are the opposite of normal goods, its demand increases with the rise in income and decreases with fall in income.
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