Shocking study reveals how price changes can alter consumer preferences
The article explains that violations of the Law of Demand are often due to changes in consumer preferences and income, rather than a true violation of the law itself. When prices of certain goods change significantly, it can lead to shifts in demand for related goods, creating a complex chain reaction. This can result in a seeming violation of the Law of Diminishing Marginal Utility. The researchers suggest that previous studies may have misunderstood these effects as changes in supply rather than demand.