Closesubstitute goods, Microeconomics

Assignment Help:

Closesubstitute goods:

The number of closesubstitute goods

The more substitutes of good has and the more close the substitutes are, the more elastic the demand for the good. For example, the beverage, bornvita, has a number of close sustitutes such as milo, chocolim, ovaltine etc. Therefore, the demand for bornvita is likely to be more leastic because the slightest increase in the price of bornvita, consumers of the product will switch to the consumption of one of the substitutes.

On the other hand, if the goods does not have any close sustitute, the demand tends to be less elastic or inelastic. For example, there is hardly a substitute to food as a whole hence the demand for food as a whole is inlestic.


Related Discussions:- Closesubstitute goods

Households and consumers, What is the difference between houehold and consu...

What is the difference between houehold and consumers?

Production function curve, different types of production funtion and curve ...

different types of production funtion and curve given by different economist

Illustration of externalities, Externalities: Many economic activities have...

Externalities: Many economic activities have collateral effects (at times positive, but more often negative) on other people who aren't directly involved in that activity. Illustra

Sources of external economies of scale, Sources of external economies of sc...

Sources of external economies of scale: Economies of Skilled Labour: This involves upgrading the skills of labour through the provision of education and training faci

Business card etiquette, "In U.S., there is a culture of greeting people of...

"In U.S., there is a culture of greeting people of the same sex. It's not common that people give attention to the people of the opposite sex. However, in the middle class, it's a

Unions in a competitive market, Unions in a Competitive Market: Again, ther...

Unions in a Competitive Market: Again, there a group of economists who will rely on the use of the competitive model to demonstrate the evils of unionization. The most regular anal

Cost, #question.theories of cost

#question.theories of cost

What is the difference between concept and assumption, What is the differen...

What is the difference between 'concept' and 'assumption'?  These two terms are very dissimilar. The term 'concept' refers to an idea or abstract principle. For instances, forc

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd