Suppose that the short-run price elasticity of demand for flu shots is 0.6. In the long run, which one of the following is most likely to represent the price elasticity of demand for flu shots?
A) 0.2
B) 0.4
C) 0.6
D) 1.8

Question

Quizplus · Accepted Answer

In general, the price elasticity of demand for most goods and services tends to increase in the long run. This is because consumers have more time to find substitutes or adjust their behavior in response to price changes. Therefore, a long-run price elasticity of 1.8 for flu shots, which is higher than the short-run elasticity of 0.6, is the most likely scenario.

Suppose That the Short-Run Price Elasticity of Demand for Flu