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Mankiw discusses Giffen goods as a possible counterexample to the law of demand. Although not explicitly mentioned by Mankiw, Veblen goods are another possible exception to the law of demand. Perform a quick web search to answer the following:

a. What is a Veblen good?
b. What is an example of a Veblen good?
c. Why do some consumers purchase Veblen goods?

Respuesta :

tutordamola

Answer:

Find the answers below

Explanation:

A. Veblen goods are luxury goods sought after by wealthy people and for which these category of people increase their demand as the prices of the good increase (in contrast to the popular law of demand).

2. Examples are luxury houses or cars, jewelry etc.

3. Some customers buy these type of goods in order to show how wealthy they are or show their status.