When is demand inelastic?

Choose 1 answer:
(A) When buyers have a lot of time to shop around

B When there are few substitutes for a good
(c) When it makes up a large share of a person's budget

D When a market is narrowly defined
(E) When a good is a luxury

Question

When is demand inelastic?

Choose 1 answer:
(A) When buyers have a lot of time to shop around

B When there are few substitutes for a good
(c) When it makes up a large share of a person's budget

D When a market is narrowly defined
(E) When a good is a luxury

Accepted Answer

∻Solution∻ ‖ a ⋮ Definition of Inelastic Demand: Inelastic demand occurs when the quantity demanded of a good is relatively unresponsive to changes in price. This means that the percentage change in quantity demanded is less than the percentage change in price. ‖‖ b ⋮ Few Substitutes: When there are few substitutes for a good, consumers have limited alternatives to switch to if the price of the good increases. This makes the demand for the good inelastic. ‖ ∻Answer∻ ⚹ B When there are few substitutes for a good ⚹ ∻Key Concept∻ ⚹ Inelastic Demand ⚹ ∻Explanation∻ ⚹ Demand is inelastic when there are few substitutes for a good because consumers cannot easily switch to other products, making their demand less sensitive to price changes. ⚹◊What factors determine whether demand is elastic or inelastic in a market according to Microeconomics?⍭ Generate me a similar question◊

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