Asked by
Jordan Davis
on Oct 14, 2024
Verified
A Giffen good must be an inferior good.
Giffen Good
A product that paradoxically sees an increase in demand as its price increases, violating the basic law of demand due to the income effect overshadowing the substitution effect.
Inferior Good
A type of good whose demand decreases as the income of consumers increases, opposite of a normal good.
- Acquire insight into the relationship between alterations in financial status and the designation of items as either inferior or normal.
- Define and identify Giffen goods and their characteristics.
Verified Answer
AB
Learning Objectives
- Acquire insight into the relationship between alterations in financial status and the designation of items as either inferior or normal.
- Define and identify Giffen goods and their characteristics.