Which of the following generalizations is not correct? Blooms: Remember
A)The larger an item is in one's budget, the greater the price elasticity of demand.
B)The price elasticity of demand is greater for necessities than it is for luxuries.
C)The larger the number of close substitutes available, the greater will be the price elasticity of demand for a particular product.
D)The price elasticity of demand is greater the longer the time period under consideration.

Question

Quizplus · Accepted Answer

The price elasticity of demand is typically greater for luxuries than for necessities, as consumers are more willing to change their consumption of luxuries in response to price changes compared to necessities.

Which of the Following Generalizations Is Not Correct? Blooms: Remember