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State Whether the Following Statements Are True Or False with Reasons: the Demand of a Rich Person is Elastic. - Economics

State whether the following statements are True or False with reasons: 

The demand of a rich person is elastic. 

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Solution

 False, the demand of a rich person is not elastic.
Explanation:
The demand of a rich person is inelastic. A rich person has a high income as a result of which he does not change his quantity demanded much when the prices change. Thus, rich people have inelastic demand.

Concept: Type of Elasticity of Demand
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