Luxuries and Necessities Assignment Help

Assignment Help: >> Determinants of Price Elasticity of Demand - Luxuries and Necessities

Luxuries and Necessities:

Luxuries are things we can always do away with henace they tend to have elastic demand. Necessities are difficult to dispense with. Therefore they tend to have inelastic demand.

Durability of the Commodity

With some commodities, we required one at a time and they are used for a very long time before they get spoilt.  Examples of such goods are cars, televisions, cars, furniture, building, clothes etc.  They tend to have low elasticity of demand (inelastic demand) because when the price of a duable commodity changes, consumers will continue to use what they have. Even when the price of such a commodity falls, it is new consumers who will mostly buy them.

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