To say there is an elastic demand for a product means that
A) there are relatively few substitutes, few competitors, and a short time period under consideration.
B) consumers are very responsive to a change in the price of the product.
C) consumers are not very responsive to a change in the price of the product.
D) if the price rises by some percentage, then the quantity demanded will fall by a smaller percentage.
E) there is a positive relationship between price and total revenue.

Question

Quizplus · Accepted Answer

Elastic demand means that consumers are very responsive to a change in price. This means that if the price of the product increases, the quantity demanded will decrease significantly. On the other hand, if the price decreases, the quantity demanded will increase significantly. This is usually seen in products that have close substitutes, many competitors and a longer period under consideration.

To Say There Is an Elastic Demand for a Product