Originated From
AOL.com

What is the most important determinant of price elasticity of demand? Why is this so?

What is the most important determinant of price elasticity of demand?  Why is this so?

Liked this question? Tell your friends about it

2 Answers

Order by
Oldest to Newest
Newest to Oldest
Votes

supply.  it's natural law I guess, like gravity, only for economics

If it's not fun, you're doing it wrong. FREE !!! Help the U.N. feed people by playing a free game at freerice.com It's free, fun and educational. Professor Snotsengabber, a charter member of S.N.O.T.S.

From my point of view, the number of substitute goods is likely the most important determinant of price elasticity of demand.

Why?-Because the more substitute goods the suppliers provide, the easier the consumers will change their tastes from one to another when there is an increase (even slight) in the price of a product.

Since I understand the definition of price of elastic of demand as simple as possible which means a measurement helps us to see how the demand for a product responds to a price change. Therefore, the consumers will responds "actively" to price changes of goods if there are enough substitute goods provided on the market.

I'm looking forward to hearing from the others about this problem.

Related Questions

Other people asked questions on similar topics, check out the answers they received:

Asked: Economics

What are the various buying roles?

Asked: Economics

What are the various aspects of decision making?

Asked: Economics

What are the various applications and methods of cost control?

More Questions

Price value on china

about $1 per acre, with rice patties only 25 cents an acre without rice.

Distinguish between elastic arteries, muscular arteries, and arterioles

If this is for a bio class, then it should be in your textbook and I'm wondering why you haven't just opened that up, because it is in there... Anyway, here is a basic overview: There are three types of arterial blood vessels: (1) elastic arteries, (2) muscular arteries, and (3) arterioles ...

I am a deli manager, just started back to work ...

First, since you have been out of retail for awhile, let me warn you...today's consumers tend to want something for nothing. No matter how good the product is or how reasonable the price, they are seldom going to be satisfied. Secondly, if you are unable to determine your prices based on your ...