Which of the following characteristics would describe a product with an inelastic demand?
A)The good is considered a necessity and many substitutes for the product exist.
B)The good is considered a necessity and few substitutes for the product exist.
C)The good is considered a luxury and many substitutes for the product exist.
D)The good is considered a luxury and few substitutes for the product exist.

Question

Quizplus · Accepted Answer

Inelastic demand is when a change in price causes only a small change in the quantity demanded. This means that the good is considered a necessity and there are few substitutes for the product. If there were many substitutes, consumers would be more likely to switch to a different product if the price of the original product increased.

Which of the Following Characteristics Would Describe a Product with an Inelastic