Which of the following statements is INCORRECT?
A) The price elasticity of demand tends to be greater for a specific brand of a product than for a product in general.
B) The price elasticity of demand tends to be smaller when consumers have less time to adjust to price changes.
C) The price elasticity of demand tends to be greater when a product accounts for a smaller portion of the consumer's budget.
D) The price elasticity of demand tends to be greater for a product with more substitutes available.

Question

Quizplus · Accepted Answer

The price elasticity of demand tends to be greater when a product accounts for a larger portion of the consumer's budget, not a smaller portion. This is because consumers are more sensitive to price changes for items that constitute a significant part of their spending.

Which of the Following Statements Is INCORRECT