Which of the following would NOT affect a good's price elasticity of demand?
A) whether the good is a necessity
B) the proportion of the budget devoted to the good
C) the number of substitute goods
D) the ease of substituting between the goods
E) the cost of producing the good

Question

Quizplus · Accepted Answer

The cost of producing the good does not directly affect the price elasticity of demand. Price elasticity of demand depends on factors such as availability of substitutes, the proportion of income that people spend on the good in question, and whether the good is a necessity or a luxury.

Which of the Following Would NOT Affect a Good's Price