Question on: JAMB Economics - 2024

An exceptional demand curve (also known as a Giffen good or Veblen good) is one where the quantity demanded increases as the price increases, and decreases as the price decreases. This is the opposite of the normal law of demand.

• A. An increase in the price of raw materials affects supply, not demand.
• B. A change in consumer taste affects demand, but usually leads to a shift in the demand curve, not an exceptional demand curve.
• C. An increase in the population size generally shifts the demand curve to the right, but does not lead to an exceptional demand curve.
• D. Expectation of future price increases can lead to an increase in current demand as consumers try to purchase the good before the price increases. This can create an exceptional demand curve in the short run.