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Okra was $13.00 per bushel in 2015, and 1.5 million bushels were sold. Okra was $14.00...

Okra was $13.00 per bushel in 2015, and 1.5 million bushels were sold. Okra was $14.00 per bushel in 2016, and 2.0 million bushels were sold. “If in both cases the okra market was in equilibrium, this must be an example of an exception to the law of demand."

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Answer.) In above example, Okra would be classified as a Giffen good. These are the types of inferior goods whose quantity demanded increases with an increase in price and decreases with the decrease in price. Remember that inferior goods are those goods for which we have an inverse relationship with income. This means that if there is rise in income of customer, it will reduce consumption of inferior good. Additionally, All giffen goods are inferior goods but all inferior goods are not giffen goods.

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