Question

Higher the price of certain luxurious
articles, higher will be the demand, this
concept is called​

Answer 1

Answer:

Higher the price of a certain luxurious article, higher will be the demand, this concept is called the Veblen effect.

Explanation:

• Veblen effect says that, the demand for the goods is increased due to the fact that it bears higher than a lower price.
• This effect is a function of price.
• Goods like jewellery and luxurious articles are meant for conscious consumption.
• In simpler terms the Veblen effect says that, higher the price of goods is paid, greater will be the satisfaction.
• This effect causes an upward sloping market demand curve

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Answer 2

• Higher the price of certain luxurious articles, higher will be the demand, this concept is called the law of demand. ​
• This law is the foundation of economics, which is the philosophy of the market economy.
• The law of demand is the economical law of the market.
• It states that higher the cost of a product, the higher the price of it will be.
• The demand determines the price, therefore the price is determined by the demand.
• The market economy is the economic theory that is based on the demand and supply of goods and services.
• The law of demand is the basis of all other laws.
• It is a general law that is applicable to all goods and services, regardless of their source.
• Both demand and price are determined by the demand for a product.

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