Insider two products: product A and product B. State whether the demand for product A is more or less price-elastic than
Posted: Mon Apr 18, 2022 9:12 am
Insider two products: product A and product B. State
whether the demand for product A is more or less price-elastic than
the demand for product B for each of the following factors. Treat
each factor separately from the others. (I) There are some close
substitutes for product A but no close substitutes for product B.
(II) On average, consumers spend 1 percent of their incomes
annually on product A; on average, consumers spend 20 percent of
their incomes annually product B. (III) Consumers consider product
A to be more of a necessity than a luxury; consumers consider
product B to be more of a luxury than a necessity.
whether the demand for product A is more or less price-elastic than
the demand for product B for each of the following factors. Treat
each factor separately from the others. (I) There are some close
substitutes for product A but no close substitutes for product B.
(II) On average, consumers spend 1 percent of their incomes
annually on product A; on average, consumers spend 20 percent of
their incomes annually product B. (III) Consumers consider product
A to be more of a necessity than a luxury; consumers consider
product B to be more of a luxury than a necessity.