A bakery supply catalogue sells 5-kg bags of moist apricots and cranberries,sweet dates,bits of pineapple,and candied cherries to be used in fruitcakes.Each bag costs $24.95.If the price of cranberries were to increase by 5 percent,it would have no effect on the price of the fruit mix because cranberries are only one of several fruits in the package.
-Refer to Fruitcake.What is the demand for cranberries for this particular use?

Question

Quizplus · Accepted Answer

The demand for cranberries used in fruitcakes is likely to be inelastic because it is a specific ingredient and there may not be a good substitute for it. Even if the price of cranberries increases, the bakery supply catalogue may still need to purchase them in order to maintain the quality of their fruit mix for the fruitcakes.

A Bakery Supply Catalogue Sells 5-Kg Bags of Moist Apricots