If a Good Is a Luxury Item That Looms Large

question 185

Essay

If a good is a luxury item that looms large in the household budget, then demand will tend to:
A.be more price-elastic.
B.be less price-elastic.
C.have price elasticity equal to 1.
D.be the same as that of a good that is a necessity.

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Definitions:

Reasoning Principle

A fundamental aspect of human thought that involves drawing conclusions or making inferences based on premises.

Pleasure Principle

is a psychoanalytic concept suggesting that people seek pleasure and immediate gratification of needs to avoid pain, guiding the id's desires.

Psychosexual Development

Freud's theory on the stages of psychological development from infancy to adulthood, focusing on how early life sexual urges shape personality.

Oral Trait

A characteristic of personality development associated with the oral stage of psychosexual development, focusing on behaviors related to the mouth such as dependency, eating, and verbal communication.