ECONOMICS
ELASTICITY OF DEMAND
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
|
|
a cold snap destroys an apple crop causing prices to jump, however, people still buy apples and quantity demanded does not change
|
|
|
Super Bowl tickets hit record high prices but are still sold out in a matter of minutes and starting going for even higher prices on resale sites
|
|
|
concert tickets are not selling well, so the venue drops prices by 80%; the tickets sell out shortly thereafter
|
|
|
a restaurant starts charging a $10 delivery fee, delivery orders drop by 50% in the first month
|
Detailed explanation-1: -Examples of goods with inelastic demand include gasoline, necessary foods, and prescription drugs. When price changes on these items, demand doesn’t fluctuate much because these items are required in the everyday lives of most consumers.
Detailed explanation-2: -The most common goods with inelastic demand are utilities, prescription drugs, and tobacco products.
Detailed explanation-3: -If a price change for a product doesn’t lead to much, if any, change in its supply or demand, it is considered inelastic. Generally, it means that the product is considered to be a necessity or a luxury item for addictive constituents. Examples would be gasoline, milk, and iPhones.
Detailed explanation-4: -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