The Elasticity of Demand for a Product Is Likely to Be

question 28

Multiple Choice

The elasticity of demand for a product is likely to be greater:

• A)if the product is a "necessity" rather than a "luxury" good
• B)the greater the amount of time over which producers adjust to a price change
• C)the smaller the proportion of one's income spent on the product
• D)the smaller the number of substitute products
• E)the greater the amount of time over which buyers adjust to a price change

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Definitions:

Litter

Discarded waste material improperly left in an environment outside designated trash disposal facilities.

Externality Analysis

The examination of costs or benefits that affect parties who are not directly involved in a transaction or activity, used to understand the implications of external effects on society.

Public Good

A product or service that is available for all members of society to consume, regardless of whether they contribute to its provision.

Public Good

A product or service offered for free to all society members, by either the government or a private entity, without the intent of making a profit.