Which of the following factors is associated with products with a highly price elastic demand?
A) Few close substitutes.
B) A very short time period for consumers to respond to price changes.
C) Many very close substitutes.
D) A per unit price that is only a very small portion of most peoples' budgets.

Question

Quizplus · Accepted Answer

When there are many very close substitutes available for a product, consumers have more options to choose from if the price increases, making the demand for that product more price elastic. When consumers have few alternatives, they are less likely to change their buying patterns in response to price changes, leading to a less elastic demand. The other options are not associated with high price elasticity of demand.

Which of the Following Factors Is Associated with Products with a Highly