A Giffen good is a good for which
A)an increase in the price raises 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 an increase in price leading to an increase in quantity demanded, due to the income effect outweighing the substitution effect.

A Giffen Good Is a Good for Which