The price elasticity of demand for a good will tend to be more elastic if
A) the good is broadly defined (e.g., the demand for food as opposed to the demand for carrots).
B) the good has relatively few substitutes.
C) a long period of time is required to fully adjust to a price change in the good.
D) None of the above is true.

Question

Quizplus · Accepted Answer

None of the options A, B, or C correctly describe conditions that make demand more elastic. Elasticity increases with narrowly defined goods, many substitutes, and shorter adjustment periods.

The Price Elasticity of Demand for a Good Will Tend