When other variables are held fixed, the demand for a Giffen good rises when income increases.

Name: When other variables are held fixed, the demand for a Giffen good rises when income increases.
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Question

Quizplus · Accepted Answer

A Giffen good is a type of inferior good where an increase in its price results in an increase in its quantity demanded. This is contrary to the law of demand. As such, the demand for a Giffen good will not rise when income increases, but rather will fall.

When Other Variables Are Held Fixed, the Demand for a Giffen