An exceptional demand curve can result from

1. Analyze the question The question asks what can cause an exceptional demand curve. This is a demand curve that does not follow the usual law of demand (price up, quantity demanded down). Instead, it slopes upward or behaves unusually.

2. Explain the concept Normally, the law of demand says that as price rises, quantity demanded falls, ceteris paribus. Exceptional demand occurs when consumers buy more at a higher price, or when the usual relationship breaks down. Common causes:

• Giffen goods: inferior goods that take up a large part of a poor person's budget (e.g., garri in some situations).
• Veblen/prestige goods: goods bought for status (e.g., luxury cars, jewellery), where a higher price makes them more attractive.
• Speculative demand / expectation of future price increase: if consumers expect the price to rise further, they buy more now even though the current price has risen.
• Ignorance: consumers assume a higher price means better quality.

3. Solution, option by option

• A. Increase in price of raw materials: This affects supply (it raises production costs and shifts the supply curve left). It is not a cause of exceptional demand.
• B. Increase in the size of the population: This shifts the whole demand curve to the right. It is a normal change in demand, not an exceptional curve.
• C. Expectation of future price increase: Consumers buy more now, so quantity demanded rises even as the price rises. This gives an upward-sloping, or exceptional, demand curve. ✔
• D. Change in taste of consumer: This shifts the demand curve, but the curve keeps its normal downward slope.

4. Answer The correct option is C. expectation of future price increase.

5. Exam tip Remember the three "exceptional demand" triggers: Giffen goods, Veblen (prestige) goods, and speculation or expectation of price rises. If an option mentions expectations, prestige, or inferior goods, think "exceptional demand". Factors like population, taste, and income cause shifts in the curve, not exceptional curves.