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A good’s price elasticity of demand depends in part on how necessary it is relative to other goods. If the following goods are priced approximately the same, which one has the least elastic demand? a. Amputation procedures for diabetes sufferers b. Yacht

Respuesta :

Answer:  option A

Explanation: Price elasticity can be defined as the relative change in the quantity demanded for goods or services with respect to change in price. There are several factors affecting price elasticity and one of them is the the nature of that good or service , that is, whether it is necessity or a luxury.

Consumers demand with respect to necessary goods do not change much when price rises as compared to luxury goods as necessary goods like daily bread and medicines are essential for life.

In above two options amputation procedure is a necessity whereas yacht is a luxury.

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