What does the demand curve for a prestige product look like?
A) It is a straight line where the quantity sold continues to increase as the price of each product increases.
B) It is a curve where the highest and the lowest prices yield the greatest quantity sold and mid-range prices produce the fewest sales.
C) It forms a curve where the greatest quantity sold comes at a medium price, and the quantities fall as the price increases or decreases.
D) It forms a straight vertical line because of the prestige of the product, and quantity sold will remain stable regardless of the price.
E) It slopes from left to right at a very mild slope; that is, as quantity increases, price decreases slowly.

Question

Quizplus · Accepted Answer

The demand curve for a prestige product usually forms a curve where the greatest quantity sold comes at a medium price, and the quantities fall as the price increases or decreases. This is because consumers are willing to pay a premium for the prestige associated with the product, but only up to a certain point. At higher prices, the appeal of the product diminishes and consumers may shift to alternative options. Similarly, at lower prices, the product may lose some of its allure to those seeking the exclusivity and status associated with owning a prestige item.

What Does the Demand Curve for a Prestige Product Look