The more and better substitutes a good has, the more elastic the demand for that good will be.

Question

Quizplus · Accepted Answer

This statement is true according to the law of demand. The more substitutes available for a good, the easier it is for consumers to switch to a different product if the price of the original good increases. This makes the demand for the original good more elastic, as consumers are more sensitive to changes in price. Conversely, if there are few or no substitutes available, the demand for the good will be more inelastic, as consumers have few options and may be willing to pay a higher price for the product.

The More and Better Substitutes a Good Has, the More