Elastic demand
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For each of the following pairs of goods, which good would you expect to have more elastic demand and why?
a. Required textbooks or mystery novels
b. Beethoven recordings or classical music recordings in general
c. Subway rides during the next 6 months or subway rides during the next 5 years
d. Root beer or water
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Solution Summary
For each of the following pairs of goods, which good would you expect to have more elastic demand and why?
a. Required textbooks or mystery novels
b. Beethoven recordings or classical music recordings in general
c. Subway rides during the next 6 months or subway rides during the next 5 years
d. Root beer or water
Solution Preview
For each of the following pairs of goods, which good would you expect to have more elastic demand and why?
a. Required textbooks or mystery novels
Novels have more elastic demand because they have close substitutes and are luxury in nature. Required text books are necessary and have no close substitutes. For instance, if the price of novels were to increase, readers would read other books. A student on the other hand must use required textbook.
b. Beethoven recordings or classical music ...
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- Bachelor of Science , Berea College
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