ECONOMICS
ELASTICITY OF DEMAND
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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the availability of substitutes
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a good’s relative importance
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The environment
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change in population
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Detailed explanation-1: -Answer and Explanation: Supply is not a determinant of price elasticity of demand as it does not concern the producers’ willingness to produce output but rather the consumers’ willingness to purchase outputs at a given price level.
Detailed explanation-2: -Answer and Explanation: Technological improvements in production is not a determinant of demand.
Detailed explanation-3: -The four factors that affect price elasticity of demand are (1) availability of substitutes, (2) if the good is a luxury or a necessity, (3) the proportion of income spent on the good, and (4) how much time has elapsed since the time the price changed.
Detailed explanation-4: -Answer and Explanation: Income is not a determinant of supply.