Which of the Following Goods Would Have the Smallest Elasticity

question 292

Multiple Choice

Which of the following goods would have the smallest elasticity of demand?

• A) Exxon brand premium unleaded gasoline
• B) insulin sold to diabetics
• C) an education at Harvard Law School sold to recent college graduates
• D) a bottle of Bayer Aspirin sold to someone without a headache

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Definitions:

Secondary Market

A marketplace where investors buy and sell securities or assets from other investors, rather than from issuing companies.

Minimum Wage Law

Legislation that sets the lowest hourly wage rate that employers can legally pay their workers.

Price

The amount of money expected, required, or given in payment for something. It serves as a signal between buyers and sellers in a market.

Labor

The human effort, both physical and mental, used in the production of goods and services.