The owner of Mr. Piggy's Bacon estimates that the price elasticity of demand for a package of their bacon to be 3.48. In relation to the price elasticity of demand for the entire bacon market, which of the following is most likely true?
A)The price elasticity for all bacon will be more responsive to price changes.
B)The price elasticity for all bacon will be greater than 3.48.
C)The price elasticity for all bacon will be more elastic.
D)The price elasticity for all bacon will be less responsive to price changes.

Question

Quizplus · Accepted Answer

The price elasticity of demand for a specific brand (like Mr. Piggy's Bacon) is typically higher than for the entire market category (all bacon) because consumers can easily switch between brands if the price of one brand changes, but they have fewer substitutes if the price of the entire category of bacon changes. Therefore, the demand for the entire bacon market is less responsive to price changes compared to a single brand within that market.

The Owner of Mr