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What can exceptional demand curve result to?
What can exceptional demand curve result to?
Expert Solution
An exceptional demand curve shows a positive relationship between price and quantity demanded. It is upward sloping from left to right which shows that a fall in price reduces the quantity demanded and a rise in price increases the quantity demanded. This is possible in case of the giffen goods which violates the law of demand. For example, a middle-class person commutes through train or airplane. An increase in train fares will reduce the disposable income of the person who may not travel through airplane again and prefer train for commuting even after a hike in fares.
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