Question

In: Economics

Compare given examples below and compare demand for these goods regarding elasticity. Which one is elastic,...

Compare given examples below and compare demand for these goods regarding elasticity. Which one is elastic, inelastic, unit elastic? Reason, explain. For each example, which determinants of elasticity of demand is affected?

  1. Bicycle pump versus Continental bicycle pump
  2. Fruit mixer versus dishwasher
  3. HIV medication versus Vitamins
  4. Car versus bus

Solutions

Expert Solution

Branded goods are elastic in nature when compared with unbranded as people would be sensitive for price changes for branded goods.

Luxury goods are elastic in nature when compared with basic or necessity goods as people would be sensitive for price changes for luxuries.

Sl.No

Good

Nature

Good

Nature

Reason

a.

Bicycle pump

Inelastic

Continental bicycle pump

Elastic

Continental bicycle pump is a luxury good when compared to bicycle pump

b.

Fruit mixer

Inelastic

Dishwasher

Elastic

Dishwasher is a luxury good when compared to fruit mixer

c.

HIV medication

Inelastic

Vitamins

Elastic

HIV medication is a necessity good when compared to fruit mixer

d.

Car

Elastic

Bus

Inelastic

Car is a luxury good and bus is a basic

Determinants of elasticity of demand includes price of own good, price of substitutes and complements, income, preferences etc. Among them price of own good is the one which affects the elasticity of demand the most.


Related Solutions

Explain the concept of elasticity of demand, and provide examples of both elastic and inelastic goods....
Explain the concept of elasticity of demand, and provide examples of both elastic and inelastic goods. What determines elasticity for your examples?
Detailed examples of two goods in your life that have an elastic demand and two goods...
Detailed examples of two goods in your life that have an elastic demand and two goods that have an inelastic demand - Explain your reasoning being sure to apply what you’ve learned in class - Provide your economic opinion on the EpiPen - using information from the articles and concepts covered in class - Lastly, answer the question ‘Should a potential Covid-19 vaccine be free and available to everyone?’ Back up your opinion using economic concepts covered in class
Demand is more elastic for luxury goods and also for goods for which there are more...
Demand is more elastic for luxury goods and also for goods for which there are more substitutes, explain how these are related
-Detailed examples of two goods in your life that have an elastic demand and two goods that have an inelastic demand.
In Module 6 we are covering the concept of Elasticity.-Detailed examples of two goods in your life that have an elastic demand and two goods that have an inelastic demand.-Explain your reasoning being sure to apply what you’ve learned about elasticity.
Suppose the price elasticity of demand 1.15 If​ so, then the demand for cereal is ​elastic...
Suppose the price elasticity of demand 1.15 If​ so, then the demand for cereal is ​elastic or inelastic. In another​ example, assume the price elasticity of demand for a particular magazine is negative .1.16 The demand for the magazine is inelastic. or . • Elastic
Which is inconsistent with an elastic demand curve? A. The price-elasticity coefficient is less than 1...
Which is inconsistent with an elastic demand curve? A. The price-elasticity coefficient is less than 1 B. Total revenues fall when prices rise C. Buyers are relatively sensitive to price changes D. The relative change in quantity exceeds the relative change in price
Topic: Product Elasticity of Demand List FIVE products or services: One should be highly elastic One...
Topic: Product Elasticity of Demand List FIVE products or services: One should be highly elastic One somewhat elastic One unit elastic (approximately) One somewhat inelastic One highly inelastic In each case, Describe why the elastic responsiveness is what it is. What would be the substitutes and/or complements of these products? Why is the cross elasticity of demand positive for substitutes and negative for complements?
For which of the following goods is the income elasticity of demand likely highest? a. tennis...
For which of the following goods is the income elasticity of demand likely highest? a. tennis lessons b. allergy medication c. clothing d. cell phone contracts
Assume the supply of a good is perfectly elastic and the income elasticity of demand is...
Assume the supply of a good is perfectly elastic and the income elasticity of demand is 13.7. When the income of households increases by 5%, the equilibrium quantity in the market will: Select one: a. increase by 13.7% b. decrease by 13.7*5% c. decrease by 13.7% d. increase by 13.7*5% e. increase by 5%
What is the coefficient of demand elasticity for the Apple watch? Is this elastic or inelastic?...
What is the coefficient of demand elasticity for the Apple watch? Is this elastic or inelastic? How do you interpret that coefficient? (Use $349 and $299 in your calculation). The quantity associated with $349 is 177,200. The quantity associated with $299 is 297,200.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT