Economics - Ch.5

elastic

A good in the presence of many close substitutes is predicted to have relatively ______ demand, since consumers can easily choose to purchase one of the close substitutes if the price of the good were to increase.

inelastic

A good with no close substitutes is predicted to have relatively ______ demand, since consumers cannot easily switch to a substitute good if the price of the good were to increase.

Alcohol - least elastic Hard seltzer - in between Raspberry white claw - most elastic

Least elastic, in between, most elastic? 1. Alcohol 2. Hard seltzer 3. Raspberry white claw

A

The price elasticity of demand of a good depends in part on its relative necessity in comparison to other goods. Assume the following goods all have approximately the same price. Which of the goods has the least elastic demand? A. Access to medicine for individuals with chronic illnesses B. Gold jewelry

Self-driving cars

The price elasticity of demand of a good depends in part on its relative necessity in comparison to other goods. Assume the following goods all have approximately the same price. Which of the goods has the most elastic demand? A. Insulin for people with diabetes B. Self-driving cars