Which of the following characteristics of a product tends to make the elasticity of demand greater?
A) The product is a necessity.
B) The time period between the price change and the measurement of change in quantity demanded is relatively short.
C) The product is relatively expensive.
D) There are no good substitutes for the product.
E) Consumers usually spend a small percentage of their income on the product.

Question

Quizplus · Accepted Answer

Products that are relatively expensive tend to have greater elasticity of demand because consumers are more sensitive to price changes when a product represents a larger portion of their spending.

Which of the Following Characteristics of a Product Tends to Make