For normal goods the demand for X varies inversely with the price of X. There are two main reasons for this. For any price change there is a substitution effect and an income effect. For example if the price of Tesco Steak falls, some consumers will switch towards Tesco steak (away from other brands or other meats) - because it has become relatively cheaper. More utility can be gained from each pound spent. This switching …showed first 75 words of 314 total…

…showed last 75 words of 314 total…types of products. Giffen Goods are strongly inferior. Veblen goods are sometimes known as goods or services of ostentatious consumption. Here demand rises with price if the market price is taken to be a sign of quality or where consumers are more concerned with the satifsaction gleaned from other people seeing them consuming expensive products. designer clothes and the Jim Keefe revision guide to A-Level Economics spring readily to mind as good examples to use.