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Question : In which of the following cases does the law of demand fail?

Option 1: Giffen goods

Option 2: Normal goods

Option 3: Inferior goods

Option 4: Both Giffen and inferior goods


Team Careers360 1st Jan, 2024
Answer (1)
Team Careers360 22nd Jan, 2024

Correct Answer: Giffen goods


Solution : The correct answer is Giffen goods .

The law of demand generally holds that when a good's price goes up, people tend to buy less of it, and when its price goes down, they buy more. However, Giffen goods stand as a unique exception to this principle. Giffen goods, while uncommon, are typically linked to essential but lower-quality products, such as basic staple foods.

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