[amp_mcq option1=”Positive” option2=”Negative” option3=”Zero” option4=”None of these” correct=”option2″]<\/p>\n
The correct answer is: B. Negative<\/strong><\/p>\n A Giffen good is a good that people demand more of as their income decreases. This is because the good is relatively cheaper for them when their income is low, and they are willing to sacrifice other goods to consume more of it.<\/p>\n For example, imagine that you are very poor and you only have enough money to buy rice and beans. If your income increases, you will be able to afford to buy other goods, such as meat and vegetables. However, you may still choose to buy more rice and beans, because they are relatively cheaper for you now.<\/p>\n The income effect towards a Giffen good is negative because the demand for the good decreases as income increases. This is because the good becomes relatively more expensive for the consumer as their income increases.<\/p>\n The other options are incorrect because:<\/p>\n [amp_mcq option1=”Positive” option2=”Negative” option3=”Zero” option4=”None of these” correct=”option2″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[],"class_list":["post-58661","post","type-post","status-publish","format-standard","hentry","category-economics","no-featured-image-padding"],"yoast_head":"\n\n