ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -They also indicated that the main determinants for luxury consumption tendency were self-enhancement and social luxury values. On the other hand, increasing household income might be a determinant of purchasing luxury goods because raised income may lead to increased demand for luxury goods.

Detailed explanation-2: -In economics, a luxury good is a good for which demand increases more than proportionally as income rises. Luxury goods are said to have high income elasticity of demand. In other words, as people become wealthier, they will buy more and more of the luxury good.

Detailed explanation-3: -The demand curve for luxury good is upward sloping and not downward sloping. It is because the luxury goods are the status symbols.

Detailed explanation-4: -Luxury goods tend to have a positive correlation between income and consumption expenditure. In fact luxury goods have a positive elasticity of demand, as demand increases more than proportionally as income rises, resulting in a high overall cunsumer spending.