The price elasticity of demand for a product tends to be large (more elastic) when
A) people spend a large share of their income on the product.
B) the population in the market area is small.
C) few good substitutes for the product are available.
D) many complementary products are available.

Question

Quizplus · Accepted Answer

When people spend a large share of their income on a product, they are more sensitive to price changes, making the demand more elastic.

The Price Elasticity of Demand for a Product Tends to Be