Question

Choose the correct answer :       

Demand elasticity of habitual goods is _________. 

Options

• (a) more elastic 

• (b) less elastic 

• (c) zero elastic 

• (d) unitary elastic

Answer 1

 Demand elasticity of habitual goods is zero elastic.
Explanation:
In case of habitual goods, the quantity demanded does not change even if there is a change in its prices. This is because the consumers are so habitual of consuming such goods, that even when the prices change, they continue to consume it due to habits.