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प्रश्न
Explain any two factors that affect the price elasticity of demand. Give suitable examples.
Mention two factors affecting the price elasticity of demand.
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उत्तर
Factors affecting the price elasticity of demand are:
- Availability of substitutes: The price of a good falls in relation to its substitute. Consumers can easily switch from one good to another even if there is only a small change in price and so its demand will increase. Hence the price elasticity of demand for commodities having close substitutes is relatively high.
- Nature of good: A good can be necessary, comfort or luxury good as per the preferences of the consumers. The demand for necessary good does not fluctuate with the price as these goods are basic for day-to-day life. Hence it is inelastic. The demand for comfort and luxury goods are elastic as the consumption of these goods can be postponed.
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संबंधित प्रश्न
How does change in the price of complementary good affect the demand for the given good? Explain with the help of an example.
State whether the following statement is true or false :
Concept of ‘elasticity of demand’ is useful for the finance minister.
Write Short note on the following.
Ratio method of measuring price elasticity of demand ?
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Perfectly elastic demand curve is _________.
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Demand of labour is _______
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Demand of electricity for domestic purpose is _________.
The account in which the specific amount is deposited per month regularly is known as ______.
Assertion (A): Demand for a commodity with large number of substitutes with be less elastic.
Reason (R): With large number of substitutes, even a small rise in its price will induce the buyers to go for its substitutes.
Which of the following correctly describes the relationship between availability of substitutes and price elasticity of demand?
What effect do habitual consumption patterns have on price elasticity of demand?
