The demand for a product is relatively elastic if
A) only a few close-substitute products are available
B) spending on the product constitutes a small portion of consumer income
C) the product is considered to be a necessity
D) the consumer has considerable time to adjust to price changes

Question

Quizplus · Accepted Answer

When demand for a product is relatively elastic, it means that consumers are more responsive to price changes. This is more likely when consumers have more time to adjust to price changes, as they can explore alternatives or adjust their consumption habits. Options A, B, and C typically relate to inelastic demand, where consumers are less responsive to price changes.

The Demand for a Product Is Relatively Elastic If