Which of the Following Factors Will Make the Demand for a Product

question 101

Multiple Choice

Which of the following factors will make the demand for a product more elastic?

• A) The product has no close substitutes.
• B) A very small proportion of income is spent on the good.
• C) A long time period has elapsed since the product's price changed.
• D) The change in the product's price was unexpected.

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Definitions:

Framing Effect

The cognitive bias where people decide on options based on whether they are presented in a positive or negative way.

Extended Service

A service agreement that extends beyond the standard warranty period, offering additional protection or maintenance services.

iPod Shuffle

A compact and discontinued music player designed by Apple Inc., notable for its small size, lack of a screen, and shuffle feature for playing music in a random order.

Anchoring Effect

A cognitive bias where individuals rely too heavily on the first piece of information offered (the "anchor") when making decisions.