ECONOMICS
ELASTICITY OF DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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They can be easily replaced by other cars
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No matter the price, people will always choose chevrolet
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Infomation not given.
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None of the above
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Detailed explanation-1: -What factors would likely explain why Chevrolet cars are very elastic? Chevrolet cars would be very elastic because we don’t have to buy that brand of car – we have lots of substitutes.
Detailed explanation-2: -The demand for a particular model of car is in turn highly elastic because of the presence of many substitutes. If the price of a particular model of car increases people will tend to wait until the price drops or will switch to another model.
Detailed explanation-3: -For example, the demand for automobiles would, in the short term, be somewhat elastic, as the purchase of a new vehicle can often be delayed. The demand for a specific model automobile would likely be highly elastic, because there are so many substitutes.
Detailed explanation-4: -High-priced products often are highly elastic because, if prices fall, consumers are likely to buy at a lower price. Goods with many alternatives or competitors are elastic because, as the price of the good rises, consumers shift purchases to substitute items.