The demand for luxury suites at basketball games is more elastic if
A) these suites are a necessity.
B) these suites are a luxury item.
C) few close substitutes exist for these suites.
D) basketball fans have little time to look for alternative suites.
E) poorer fans cannot afford luxury suites.

Question

Quizplus · Accepted Answer

Luxury suites are considered a luxury item and are not a necessity, therefore the demand for them is more elastic. If there are other close substitutes available, the demand for luxury suites would be even more elastic as customers have more options to choose from. The affordability of luxury suites for poorer fans is not directly related to the elasticity of demand for these suites.

The Demand for Luxury Suites at Basketball Games Is More