A good that has highly elastic demand is most likely to:
A) have a large number of substitutes.
B) be purchased by low-income consumers.
C) be sold at a high price level.
D) be produced by a single firm.
E) be a necessary good.

Question

Quizplus · Accepted Answer

When a good has highly elastic demand, it means that a small change in price could result in a significant change in the quantity demanded. This is often the case when there are many substitutes available for the good, as consumers have more options to choose from and can easily switch to a different product if the price of one becomes too high. Therefore, choice A, which states that goods with highly elastic demand are likely to have a large number of substitutes, is the best answer.

A Good That Has Highly Elastic Demand Is Most Likely