When There Are Few Close Substitutes Available for a Good

question 41

Multiple Choice

When there are few close substitutes available for a good, demand tends to be

• A) perfectly inelastic.
• B) perfectly elastic.
• C) relatively inelastic.
• D) relatively elastic.

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Definitions:

Price Elasticity

A measure of how much the quantity demanded or supplied of a good responds to a change in its price, indicating the sensitivity of consumers or producers to price changes.

Demand Schedule

A table that shows the quantity of a good or service that consumers are willing and able to purchase at various prices.

Price Elasticity Of Demand

The ratio of the percentage change in quantity demanded of a product or resource to the percentage change in its price; a measure of the responsiveness of buyers to a change in the price of a product or resource.

Percentage Changes

Calculations that measure the degree of change over time, expressed as a percentage to highlight growth or decline in quantitative data.