PED Determinants

Which of the following is a determinant of price elasticity of demand?

• Supply
• Necessity
• Number of substitutes
• Consumer preferences

If a good has many close substitutes, its demand is likely to be?

• Inelastic
• Elastic
• Unit elastic
• Perfectly inelastic

What is the price elasticity of demand for a necessity?

• Elastic
• Inelastic
• Unit elastic
• Perfectly elastic

If a good takes up a small proportion of income, its demand is likely to be?

• Elastic
• Inelastic
• Unit elastic
• Perfectly elastic

In the short run is the price elasticity of demand.... ?

• More elastic
• More inelastic

• Remains unchanged
• Elastic at first, then less elastic

If a product is addictive, its demand tends to be?

• Inelastic
• Elastic
• Unit elastic
• Perfectly inelastic

Brand loyalty causes demand to be?

• Elastic
• Inelastic
• Unit elastic
• Perfectly elastic

The price elasticity of demand for luxury goods tends to be?

• Inelastic
• Elastic
• Unit elastic
• Perfectly inelastic

Goods that are durable typically have?

• Elastic demand
• Inelastic demand
• Unit elastic
• Perfectly inelastic demand

Inelastic demand means that consumers are?

• Highly responsive to price changes
• Not very responsive to price changes
• Equally responsive to price changes
• Insensitive to price changes