The demand for a pack of gum is _____ price elastic than the demand for a steak because a pack of gum _____.
A) less; requires a smaller portion of one's income
B) more; requires a smaller portion of one's income
C) less; is more of a luxury
D) more; is more of a luxury

Question

Quizplus · Accepted Answer

The demand for a pack of gum is less price elastic than the demand for a steak because a pack of gum requires a smaller portion of one's income. This means that a change in price will have a smaller impact on the decision to purchase gum compared to the decision to purchase a steak.

The Demand for a Pack of Gum Is _____ Price