If a good has a price-inelastic demand, then which of the following is NOT likely to be characteristic of this good?
A) It is a necessity and is relatively small proportion of the household budget.
B) It has many substitutes.
C) Consumers spend a small percentage of their income on it.
D) Consumers do not have much time to adjust to market changes.

Question

Quizplus · Accepted Answer

A good with price-inelastic demand typically does not have many substitutes, as the availability of substitutes would make the demand more elastic.

If a Good Has a Price-Inelastic Demand, Then Which of the Following