Asked by
Serenity On-Phouttharath
on Oct 26, 2024
Verified
If a good has a price-inelastic demand,then which statement is NOT likely to be characteristic of this good?
A) It is a necessity and is relatively small proportion of the household budget.
B) It has many substitutes.
C) Consumers spend a small percentage of their income on it.
D) Consumers do not have much time to adjust to market changes.
Price-Inelastic Demand
A situation where the demand for a good or service is relatively unaffected by changes in its price.
Household Budget
a financial plan that allocates future personal income towards expenses, savings, and debt repayment.
Market Changes
Alterations or shifts in the conditions of a market, which can include changes in consumer preferences, technological advancements, or variations in supply and demand.
- Absorb the theory behind the price elasticity of demand.
- Delineate the contrast between luxury items and essentials in relation to their price elasticity.
Verified Answer
KC
Learning Objectives
- Absorb the theory behind the price elasticity of demand.
- Delineate the contrast between luxury items and essentials in relation to their price elasticity.