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Which is not characteristic of a product with relatively inelastic demand?

  1. The good is regarded by consumers as a necessity.
  2. There are a large number of good substitutes for the good.
  3. Buyers spend a small percentage of their total income on the product.
  4. Consumers have had only a short time period to adjust to changes in price.

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Margaux Elysse C. Siason
Margaux Elysse C. SiasonLv6
29 Aug 2020
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Related questions

The value of the price elasticity of demand for a good will be relatively large when

A) the good is a luxury rather than a necessity.

B) there are no good substitutes available for the good.

C) the time period in question is relatively short.

D) All of the above are correct.

Consider some determinants of the price elasticity of demand:

  • The availability of close substitutes
  • Whether the good is a necessity or a luxury
  • How broadly you define the market?
  • The time horizon being considered
 

A good without any close substitutes is likely to have relatively ___________(inelastic/elastic) demand since consumers cannot easily switch to a substitute good if the price of the good rises.

A good's price elasticity of demand depends in part on how necessary it is relative to other goods. If the following goods are priced approximately the same, which one has the least elastic demand?

A. Diamond necklace

B. A heart value for heart attack victims

The price elasticity of demand for good also depends on how you define the good.

Organize the goods found in the following table by indicating which is likely to have the most elastic demand, which is likely to have the least elastic demand, and which will have demand that falls in between.

Categories Most Elastic In Between Least Elastic
Food      
Red Bell Peppers      
Vegetables      
 

The price elasticity of demand is also affected by the given time horizon.

If the price of gasoline is relatively high for a long time, consumers are more likely to buy more fuel-efficient cars or switch to alternatives like public transportation. Therefore, the demand for gasoline is__________ (less, more, no more, nor less) elastic in the short run than in the long run.

 

The elasticity of demand for a product is likely to be greater: 
 
(i) the smaller the number of substitute products available. 
(ii) the greater the amount of time over which buyers adjust to a price change.
(iii) if the product is a necessity, rather than a luxury good.
(iv) the smaller the proportion of one's income spent on the product. 
 

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