Because Services Cannot Be Stored, Much Greater Responsiveness to Demand

question 47

True/False

Because services cannot be stored, much greater responsiveness to demand fluctuation must exist, and therefore, much greater pricing flexibility must be maintained.

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Definitions:

Shoes

Footwear items designed to protect and comfort the human foot while offering various styles and functions.

Income Elasticity

Measures how the quantity demanded of a good changes in response to a change in consumers' income.

Normal Good

A type of good for which demand increases as the income of consumers increases, and decreases when consumer income decreases.

Inferior Good

A type of good for which demand decreases as the income of consumers increases, opposite of a normal good.