Show the impact on price elasticity of demand, Microeconomics

Assignment Help:

Q. Food purchases are relatively price inelastic since food is a necessity. If food is so required for life, how will we explain the heavy advertising of food items at the grocery stores -  how could that impact the price elasticity of demand for the distinct food products?

ANSWER:   It is possible for the demand for a general class of goods to be price inelastic (such as food in general) but for shopping at any given brand or for any given store to be very price elastic due to the large number of stores selling essentially identical goods, or due to the number of food items that will be substitutes for each other. For illustration, there are more than 10 different brands of yoghurt, and consumers can be very price elastic in terms of preferring to buy the brand of yoghurt which is on sale at a given store.


Related Discussions:- Show the impact on price elasticity of demand

What is mixed economy, Mixed Economy: This type of economic system combines...

Mixed Economy: This type of economic system combines the features of both the capitalist and socialist economic systems. The private sector is allowed to function on the principles

Market demand curve, How to graph the market demand on tobacco taxing in ca...

How to graph the market demand on tobacco taxing in california

Aggregate demand for wheat, Aggregate Demand For Wheat The demand for U...

Aggregate Demand For Wheat The demand for U.S. wheat is comprised of domestic demand and export demand. The domestic demand for wheat can be given by the equation: -QDD =

Implications of privatisation for a small island economy, Question 1: (...

Question 1: (a) The Mauritian government is now increasingly involving the private sector in the development of the economy. How can government support effective private secto

Explain fixed capital and flat-rate tax, Q. Explain Fixed Capital and Flat-...

Q. Explain Fixed Capital and Flat-Rate Tax? Fixed Capital: Realcapital which is installed permanently in a specific location, including infrastructure, buildings and major eq

Physical properties of s block elements, group trend including ionic and at...

group trend including ionic and atomic radii,electron affinity,electronegativity,charge density and ionization potential

Perfect competition, The price at which output is sold in a perfectly compe...

The price at which output is sold in a perfectly competitive market is determined by

PRESENT VALUE FUTURE PAYMENTS, How does an increase in the size of a future...

How does an increase in the size of a future payment affect the present value of a future payment

Perfect competition, Perfect Competition It's a market where conditions...

Perfect Competition It's a market where conditions prevail like that buyers and suppliers are without the ability to manipulate price in any significant way such that the marke

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