A product with an elastic demand means that
A) consumers are relatively sensitive to a change in the price of the product.
B) consumers are relatively insensitive to a change in the quantity demanded.
C) consumers are relatively insensitive to a change in the price of the product.
D) producers are relatively insensitive to a change in the price of the product.
E) producers are relatively sensitive to a change in the quantity demanded.

Question

Quizplus · Accepted Answer

A product with an elastic demand means that consumers are relatively sensitive to a change in the price of the product. This means that if there is a small increase in the price of the product, consumers will significantly reduce their demand for it. Similarly, if there is a small decrease in the price of the product, consumers will significantly increase their demand for it.

A Product with an Elastic Demand Means That