I asked this question related to inferior good ,
Expert said that inferior is not an exception of l aw of demand , but everywhere on the Internet and in my economics book it's the first exception .
It says that increase in the price of an inferior good increases the demand for that good
What is right ?
Udit, Inferior goods are not exceptional to the law of demand. In fact, these are the Giffen Goods, which violate the law of demand. Similar to the demand of Normal Goods, the demand for inferior goods also rises as their price falls and vice-versa. However, it should be remembered that unlike Normal Goods, Inferior Goods do not share a positive relationship with consumer's income. That is, they share negative relationship with the consumer's income.
|Types of Goods||Relationship with Price||Relationship with Consumer's Income|
|Demand of Normal Goods||Negative||Positive|
|Demand of Inferior Goods||Negative||Negative|
|Demand of Giffen Goods||Positive||Negative|
In order to study more about the concept of Inferior Goods and Giffen Goods go through the lesson 4 of Chapter-2 of Microeconomics of our study material.