Since for most people,eating in restaurants is a luxury and eating at home is a necessity,the price elasticity of demand for food eaten at home is lower than the price elasticity of demand for eating in restaurants.

Question

Quizplus · Accepted Answer

This statement is true because food eaten at home is a necessity and is something that people will always need to purchase. Therefore, the demand for food eaten at home is relatively inelastic, meaning that changes in price have less of an impact on the quantity of food purchased. On the other hand, eating in restaurants is a luxury and is not essential for survival. Therefore, the demand for eating in restaurants is more elastic, meaning that changes in price will have a greater impact on the quantity of restaurant meals purchased.

Since for Most People,eating in Restaurants Is a Luxury and Eating