Demand for a Product Tends to Be More Elastic the Longer

question 58

Multiple Choice

Demand for a product tends to be more elastic the longer the time period considered because

• A) sellers have more time to expand production.
• B) buyers have more time to search for substitutes.
• C) price increases over time make the price larger relative to buyers' incomes.
• D) the inverse relationship between the price and the quantity demanded weakens over time.
• E) buyers get used to the new price.

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Definitions:

Product Differentiation

The method of differentiating a product or service to appeal more to a specific target market.

Differentiation

The process of distinguishing a product or service from others to make it more attractive to a particular target market.

Economically Productive

Activities or processes that generate goods or services which have value and contribute to the economy.

Convey Information

The act of communicating or transmitting information from one entity to another.