When customers face significant __________, the demand for the existing product becomes more inelastic.

Question

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Switching costs refer to the costs a customer incurs when switching from one product to another. If these costs are significant, such as the cost of time or money it takes to learn how to use a new product, customers are less likely to switch to a substitute product even if the price of the existing product increases. This makes the demand for the existing product more inelastic.

When Customers Face Significant __________, the Demand for the Existing