Beer and Brewing

Is the demand for beer elastic or inelastic?

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2011-08-22 02:06:46

The demand for beer is elastic.

Beer is not a necessity good and therefore demand is highly

affected by price. A good demonstration of this is the heavy summer

price competition between manufacturers and the popularity of

discount brands.

It's regulated by state taxes.

Beer is elastic because it is not a necessity for survival and

because there are many substitutes for beer (ie red wine,

champagne), demand is highly affected by price changes.

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