ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Goods that are considered essential have a low elasticity of demand. Electricity, gas, oil, and water are all relatively inelastic because consumers rely on these as necessities rather than luxuries.

Detailed explanation-2: -The most common goods with inelastic demand are utilities, prescription drugs, and tobacco products. In general, necessities and medical treatments tend to be inelastic, while luxury goods tend to be most elastic.

Detailed explanation-3: -Goods with an elastic demand tend to be non-necessities, such as entertainment items or luxuries. Goods with an inelastic demand tend to be necessary items, such as food, fuel, and medicine. Elastic demand is caused by price, income, advertising, availability of substitutes, and other products.

Detailed explanation-4: -The moment you raise your price even just a little, the quantity demanded will decrease. Examples of perfectly elastic products are luxury products such as jewels, gold, and high-end cars.

Detailed explanation-5: -Petrol – petrol has few alternatives because people with a car need to buy petrol. For many driving is a necessity. Salt. A good produced by a monopoly. Tap water. Diamonds. Peak rail tickets. Cigarettes. Apple iPhones, iPads. 04-May-2019