Q.

An exceptional demand curve is one that moves -

A. upward to the right
B. downward to the right
C. horizontally
D. vertically
Answer» B. downward to the right
Explanation: A demand curve that violates the law of demand is termed an exceptional demand curve. If a household expects the price of a commodity to increase, it may start purchasing a greater amount of the commodity even at the presently increased price. Similarly, if the household expects the price of the commodity to decrease, it may postpone its purchases. Thus, law of demand is violated in such cases. In this case, the demand curve does not slope down from left to right; instead it presents a backward slope from the top right to down left. This curve is known as an exceptional demand curve.
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