Gujarat BoardEnglish MediumSTD 11 CommerceEconomicsDemand2 Marks
Question
What is the meaning of status symbol goods ?
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Answer
Diamonds, gems, pearls, etc are status symbol articles and law of demand does not apply to then because such things are demanded by the rich people only.
Therefore, if their price decreases, the rich people do not buy then because they are no more status symbols.
The rich people feel that even the ordinary man is able to buy these things are therefore, their status value decreases.
On the other hand, ordinary people do not want to buy these things because only rich people afford them.
Now they could buy these things decreases, demand does not increase.
Thus, the law of demand does not apply to such articles.
In short, such things get status value when they are costlier.
Their status increases if price increases.
When their price decreases, their demand decreases because their status value decreases.
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