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    factors that influence the price elasticity of demand

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    There are 4 factors that influence the price elasticity of demand:

    â?¢The availability of substitutes
    â?¢The specific nature of the good
    â?¢The part of income spent on the good
    â?¢The time consumers have to buy the good

    â?¢Choose a product you have purchased in the past month from a grocery or home improvement store. (Ceiling Fan-$47.68)

    â?¢Describe how each of the 4 factors contributed to the elasticity of the good.

    â?¢Is the product considered elastic, inelastic, or unitary elastic?

    â?What effect does the current supply and current demand have on this product?

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    Solution Preview

    Consider this response a "rough-cut"....you should rewrite it in your own style so that your prof doesn't doubt that you created the response.....

    Choose a product you have purchased in the past month from a grocery or home improvement store. ------(Ceiling Fan-$47.68)

    Describe how each of the 4 factors contributed to the elasticity of the good.
    1)The availability of substitutes.....there are many styles of "ceiling fans" available, however my budget was to select one for under $50. In this price range, I found this particular fan's color matched the room, it had 5 vs. 4 blades, came with an unlimited product warranty, and was a quick-connect version. Other fans that had similar specifications were priced $89 - $139.
    2)The ...

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    This solution contextualizes factors that influence the price elasticity of demand.

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