Show Now that you have a general idea of what elasticity is, let’s consider some of the factors that can help us predict whether demand for a product is likely to be elastic or inelastic. The following are important considerations:
With these considerations in mind, take a moment to see if you can figure out which of the following products have elastic demand and which have inelastic demand. It may be helpful to remember that when the buyer is insensitive to price, demand is inelastic.
Self Check: Explaining ElasticityAnswer the question(s) below to see how well you understand the topics covered in the previous section. This short quiz does not count toward your grade in the class, and you can retake it an unlimited number of times. You’ll have more success on the Self Check if you’ve completed the two Readings in this section. Use this quiz to check your understanding and decide whether to (1) study the previous section further or (2) move on to the next section. Are running shoes inelastic or elastic?Using economic terms, consumers will not be very sensitive, or responsive, to price changes—so the demand for shoes will likely be price inelastic.
Is Nike demand elastic or inelastic?Nike's products are price elastic since they are categorized as luxury goods.
Is demand more elastic in the long run or short run?Demand tends to be more elastic in the long rung rather than in the short run, because when prices change consumers often need more time to respond and change their shopping habits.
What explains that the demand for Nike shoes is more price elastic than the demand for sneakers in general?Answer and Explanation: The demand for Nike shoes is more price elastic than the demand for sneakers as a whole because Nike shoes are luxurious goods (a).
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