The amount of time elapsed since a price change influences the price elasticity of demand because as more time passes,
A)consumers find more substitutes and the price elasticity of demand for the original good decreases.
B)consumers find more substitutes and the price elasticity of demand for the original good increases.
C)the price of the good will return to its original value.
D)the income of consumers rises and the price elasticity of demand for the good increases.
E)the income of consumers rises and the price elasticity of demand for the good decreases.

Question

Quizplus · Accepted Answer

Over time, consumers have the opportunity to find more substitutes for a product whose price has changed. This makes their demand more sensitive to price changes, hence increasing the price elasticity of demand for the original good.

The Amount of Time Elapsed Since a Price Change Influences