The larger the proportion of price-sensitive customers in a product's market,the more sensitive overall demand is to a change in the product's price.

Question

Quizplus · Accepted Answer

This statement is true. Price-sensitive customers are those who are more likely to change their purchasing behavior in response to a change in price. Therefore, if a product's market is composed largely of price-sensitive customers, demand for the product will be more affected by changes in its price.

The Larger the Proportion of Price-Sensitive Customers in a Product's