In some markets consumers may buy many different brands of a product. Which of the statements below best represents a situation where demand for a particular brand would be very elastic?
A)"The different brands are almost identical. I always buy the cheapest."
B)"I use so little of that product that when I do buy it, I don't pay much attention to the price."
C)"The brand I buy is so superior to other available brands that I hardly consider the others."
D)"I pinch pennies in buying other products, but like most people, I feel I owe it to myself to get the best brand of this product."

Question

Quizplus · Accepted Answer

Elastic demand means consumers are very sensitive to price changes, and will switch brands if one is cheaper. Statement A indicates the consumer views all brands as identical and chooses based on price, which is a classic example of elastic demand.

In Some Markets Consumers May Buy Many Different Brands of a Product