If a Good Has Many Close Substitutes, Then Its Demand

question 103

Multiple Choice

If a good has many close substitutes, then its demand is most likely

• A) elastic.
• B) unit elastic.
• C) inelastic.
• D) perfectly inelastic.
• E) elastic or inelastic depending on whether the price of the good is increasing or decreasing.

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Definitions:

Silver Price

The market price for silver, typically expressed per ounce, which can fluctuate based on supply and demand dynamics.

Forward Contract

An individualized pact made between two entities to trade an asset on an agreed future date at a price set in the present.

Make Delivery

The process of fulfilling an order by providing the promised product or service to the buyer.

Accept Payment

The act of receiving money or other forms of payment in exchange for goods or services provided.