First blank : elastic/inelastic Consider some determinants of the price elastici
ID: 1142291 • Letter: F
Question
First blank : elastic/inelastic
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 the price of the good rises. demand, since consumers cannot easily switch to a substitute good if 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 most elastic demand? A heart valve for heart attack victims O Diamond necklace The price elasticity of demand for a 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 Vegetables Red bell peppers less more The price elasticity of demand is also affected by the given time hori no more, nor less, Other things being equal, the demand for natural gas will tend to be elastic in the short run than in the long runExplanation / Answer
Answer.) A good without any close substitutes is likely to have relatively INELASTIC demand.
DIAMOND NECKLACE has the most elastic demand.
Food = Least Elastic
Vegetables = in between
Red bell peppers = Most elastic
Other things being equal, the demand for natural gas will tend to be LESS elastic in the short run than in the long run.
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