answersLogoWhite

0

AllQ&AStudy Guides
Best answer

All Giffen goods are inferior goods. But not all inferior goods are Giffen goods.

For inferior goods, the negative substitution effect will more than offset the positive income effect, so that total price effect will be negative. For Giffen goods, the positive income is positive and very strong that the law of demand does not hold. Price elasticity of Giffen good is positive.

Inferior Goods: Cheap goods

Giffen Goods: Rice, wheat, noodles are Giffen goods in China

This answer is:
Related answers

All Giffen goods are inferior goods. But not all inferior goods are Giffen goods.

For inferior goods, the negative substitution effect will more than offset the positive income effect, so that total price effect will be negative. For Giffen goods, the positive income is positive and very strong that the law of demand does not hold. Price elasticity of Giffen good is positive.

Inferior Goods: Cheap goods

Giffen Goods: Rice, wheat, noodles are Giffen goods in China

View page

The phrase "All Giffen goods are inferior goods, but not all inferior goods are Giffen goods" implies that a company called Giffen only creates goods that would be deemed inferior. By contrast, however, it cannot be assumed that any inferior good has been produced by the Giffen company.

View page

has a positive income effect

is an nferior good

View page

Robert Giffen was born in 1837.

View page

Walter Giffen was born in 1861.

View page
Featured study guide

Economics

18 cards

Why is taxation necessary

What does enforcing consumer-protection regulations involve

What is one drawback to consumer-protection regulations

Sort the statements below into the correct order in which the federal budget is prepared

➡️
See all cards
5.0
1 Review
More study guides
3.93
14 Reviews

1.52
31 Reviews
Search results