For each of the following pairs of products determine which product is more own

Question

For each of the following pairs of products determine which product is more own price elastic in demand, and identify the own price elasticity of demand determinant(s) involved.It is possible that there may be more than one relevant elasticity determinant. Note that elasticity determinants are not the same as demand determinants.

a. Honda Accords, passenger cars The product that is more elastic is ___________ The own price elasticity of demand determinant(s) involved is/are ___________

b. Foreign travel, rubber bands The product that is more elastic is _______________The own price elasticity of demand determinant(s) involved is/are _____________

c. Christmas toys at Thanksgiving time, Christmas toys on Christmas Eve The product that is more elastic is ___________ The own price elasticity of demand determinant(s) involved is/are_______________

d.Printers, bread The product that is more elastic is ________________________The own price elasticity of demand determinant(s) involved is/are_______________

Explanation / Answer

a. he product that is more elastic ___honda accords__ . This is because passenger cars is a broader defination of cars and therefore less elastic.Also, honda accords have many substitute cars. The own price elasticity of demand determinant(s) involved is/are __broad category of the good and avialability of the substitutes.____

b.  Foreign travel, rubber bands The product that is more elastic is _______foreign travel________The own price elasticity of demand determinant(s) involved is/are ________usage type of the good_____Rubber band beeing the necessary good has inelatic demand compared to foreign travel, which is a luxury good.

c. Christmas toys at Thanksgiving time, Christmas toys on Christmas Eve The product that is more elastic is _____ Christmas toys at Thanksgiving time______ The own price elasticity of demand determinant(s) involved is/are___________degree of necessity____

d.Printers, bread The product that is more elastic is _______printers_________________The own price elasticity of demand determinant(s) involved is/are________necessity_______

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