Question

Why is the law of demand not applicable to goods having special taste and preference? Explain with an example.

Answer 1

Explanation:

There are certain exceptions to the law of Demand for specific products. Examples are Giffen goods, Veblen goods, income change of the family, luxury items; all these concepts do not follow the law of Demand. Say, in case of necessary items, the Demand stays the same even if the price increases.