The demand for a luxury good whose purchase would exhaust a big portion of one's income is
A)perfectly price inelastic.
B)perfectly price elastic.
C)relatively price inelastic.
D)relatively price elastic.

Question

Quizplus · Accepted Answer

Luxury goods, especially those that consume a significant portion of one's income, tend to have relatively price elastic demand. This means that the quantity demanded changes significantly with a change in price, as consumers will cut back on or increase their purchases of these goods more readily in response to price changes compared to necessities.

The Demand for a Luxury Good Whose Purchase Would Exhaust