An acute shortage of heavy-duty tires is threatening to disrupt operations in mining and construction sites around the world. According to one mine operator, "I've got the coal and market, and I have the trucks to haul the coal, but I don't have the tires. I'd be willing to pay double the price if I could get the tires I need." What type of demand is the demand for heavy-duty tires in this example?

Question

Quizplus · Accepted Answer

The demand for heavy-duty tires in this example is inelastic because the mine operator is willing to pay double the price to get the tires they need, indicating that the demand is not very sensitive to changes in price.

An Acute Shortage of Heavy-Duty Tires Is Threatening to Disrupt