The following information pertains to three different products being sold by Modular Company: Which products have an inelastic demand curve?
A) Product C
B) Product B
C) Product A
D) both Product A and Product C

Question

The following information pertains to three different products being sold by Modular Company:  Which products have an inelastic demand curve?
A) Product C 
B) Product B 
C) Product A 
D) both Product A and Product C

Quizplus · Accepted Answer

Products with inelastic demand have a relatively small change in demand when there is a change in price. Based on the given information, Product A has a unique feature that provides a competitive advantage, which suggests that customers may be willing to pay the current price regardless of changes. Product C, on the other hand, has a limited availability, which also hints at an inelastic demand. Both of these factors indicate that the demand for Product A and Product C is likely to be inelastic, making answer D the correct choice.

The Following Information Pertains to Three Different Products Being Sold