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What type of good will tend to have an elastic demand. luxuries necessities normal goods or inferior goods?
Luxuries tend to have an elastic demand because consumers can easily reduce their consumption or forgo these items when prices rise or their income decreases. In contrast, necessities typically have inelastic demand, as people need them regardless of price changes. Normal goods may exhibit varying elasticity depending on consumer preferences and income levels, while inferior goods often have inelastic demand when they serve as substitutes for more expensive options.
How would you rank the following items from the least elastic (most inelastic) to the most elastic?
The ranking of elasticity from least elastic (most inelastic) to most elastic is as follows: necessity goods, luxury goods, and normal goods.
What factors contribute to the demand for inelastic goods and how does their price elasticity affect consumer behavior?
Factors that contribute to the demand for inelastic goods include the necessity of the product, lack of substitutes, and consumer habits. Inelastic goods have a low price elasticity, meaning that changes in price do not significantly affect consumer behavior. Consumers are willing to pay higher prices for inelastic goods because they are essential or have limited alternatives, leading to relatively stable demand regardless of price fluctuations.
Why does demand for substitutes tend to move in the opposite direction from each other?
Answer this question… A. When the price of a good goes up, consumers shift their demand to its substitute. B. Substitute goods have perfect unit elasticity for each other. C. Substitute goods tend to have inelastic demand. D. One of the substitutes is usually elastic, while the other is inelastic.
What factors tend to make demand curves more price elastic?
Close substitutes, increased income, luxury goods, time. Addiction makes demand less elastic, (inelastic) ex. Cigarettes. As time increases more substitutes become available.
What is the difference between inelastic and elastic goods?
Elastic goods usually have many substitutes, so changes in price will decrease demand. Inelastic goods, on the other hand, have very few substitutes, so demand isn't generally affected by price change.
What is the difference between elastic and inelastic?
Elastic goods usually have many substitutes, so changes in price will decrease demand. Inelastic goods, on the other hand, have very few substitutes, so demand isn't generally affected by price change.
How would you rank the following items from the least elastic (most inelastic) to the most elastic?
The ranking of elasticity from least elastic (most inelastic) to most elastic is as follows: necessity goods, luxury goods, and normal goods.
What factors contribute to the demand for inelastic goods and how does their price elasticity affect consumer behavior?
Factors that contribute to the demand for inelastic goods include the necessity of the product, lack of substitutes, and consumer habits. Inelastic goods have a low price elasticity, meaning that changes in price do not significantly affect consumer behavior. Consumers are willing to pay higher prices for inelastic goods because they are essential or have limited alternatives, leading to relatively stable demand regardless of price fluctuations.
What makes a price elastic?
If a change or increase in price will affect demand. Elastic goods are usually those that the consumer does not NEED to purchase, such as luxury goods. When the producer increases price, demand will usually increase. Inelastic goods are those that the consumer needs to buy no matter what the price is, such as milk or salt. A sale or price increase won't affect the demand at all.
Why does demand for substitutes tend to move in the opposite direction from each other?
Answer this question… A. When the price of a good goes up, consumers shift their demand to its substitute. B. Substitute goods have perfect unit elasticity for each other. C. Substitute goods tend to have inelastic demand. D. One of the substitutes is usually elastic, while the other is inelastic.
What is elasticity of demands?
How much demand of a product goes up or down depending on the price. Elastic demand changes greatly as price changes - for normal goods, as the price goes up, demand drops. Demand for things like non-staple food - like cookies - is elastic. If cookies cost 50 cents a box, there might be huge demand for them. But if that price goes to $10 a box, if the price were elastic, the demand would be much lower. For an inelastic demand curve, people's demand changes little as prices change. THese are goods for which there are few substitutes. Things like gasoline have relatively inelastic demand curves - people will slow down their use/demand of gasoline a bit as prices go up, but a certain level of gasoline consumption is going to exist regardless of price. People are simply going to pay what they have to to get it.
What factors tend to make demand curves more price elastic?
Close substitutes, increased income, luxury goods, time. Addiction makes demand less elastic, (inelastic) ex. Cigarettes. As time increases more substitutes become available.
If the demand of goods is elastic what should be done with the price in order to realize more revenues?
If the demand for goods are elastic, then small changes in the price will have larger effects on the quantity demanded. In order to realize more revenues, the producer may decrease prices a little, leading to a large increase in the quantity demanded. Eg Price Quantity Demanded Profit Elastic 5 1500 7500 6 1000 6000 Inelastic 5 1100 5500 6 1000 6000
What is an example of a product that is not elastic?
A product that is "not elastic" is considered "inelelastic." More precisely, we say that DEMAND for the product is elastic or inelastic (a good example of an"elastic product" is a rubber band, but that is to say nothing of its demand.Inelastic goods tend to fall into a few categories. They may be goods which have few close substitutes. This means that broadly defined goods tend to have less elastic demand than narrowly defined goods. For example, "vegetables" have less elastic demand than "broccoli," because if the price of broccoli goes up, we can easily switch to cauliflower or asparagus. Likewise, "vegetables" have more elastic demand than "food." When vegetables are more costly, we can stock up on grains or fruits (but probably won't switch to more meats, since they tend to be more expensive already). If the price of food goes up, we will simply pay it if we can. Thus, "food" is a relatively inelastic good.Another category of goods with inelastic demand is goods whose cost represents a small portion of our budgets. Salt is a great example. If the cost of salt doubles from $1 to $2, we are unlikely to cut our consumption in half. We may not even notice.
What is inelastic demand?
demand for goods that although its price is increased , you still want to buy it
What is the ranking of the following products in order of elasticity of demand, from the least elastic to the most elastic?
The ranking of the products in order of elasticity of demand, from the least elastic to the most elastic, is as follows: necessity goods, luxury goods, and then substitute goods.
