A Giffen good is a good for which
A)a decrease in the price decreases the quantity demanded.
B)the income effect outweighs the substitution effect.
C)an increase in the price decreases the quantity demanded.
D)Both a) and b) are correct.

Question

Quizplus · Accepted Answer

A Giffen good is characterized by a situation where a decrease in price leads to a decrease in quantity demanded, and the income effect outweighs the substitution effect, making both A and B correct.

A Giffen Good Is a Good for Which