1. The price elasticity of demand for bread A. is computed as the percentage change in quantity demanded of bread divided by the percentage change in price of bread. B. will be higher if there is a new product that is a close substitute for bread. C. will be higher if consumers consider bread to be a necessity. D. All of the above are correct. E. A and B, only
1. The price elasticity of demand for bread A. is computed as the percentage change in quantity demanded of bread divided by the percentage change in price of bread. B. will be higher if there is a new product that is a close substitute for bread. C. will be higher if consumers consider bread to be a necessity. D. All of the above are correct. E. A and B, only
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter6: Consumer Choices
Section: Chapter Questions
Problem 15CTQ: Income Effects depend on the income elasticity of demand for each good limit you buy. If one of the...
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When there is a new product that is a close substitute for bread, the price elasticity of demand for bread would be higher. Hence, option B is correct.
When the bread is considered to be a necessity good, the price elasticity of demand for bread would be higher. Hence, option C is correct.
Hence, the correct option is D.
![1. The price elasticity of demand for bread
A.
is computed as the percentage change in quantity demanded of bread divided by the percentage change
in price of bread.
B. will be higher if there is a new product that is a close substitute for bread.
C. will be higher if consumers consider bread to be a necessity.
D. All of the above are correct.
E. A and B, only](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3b986d43-f8e9-4ae1-9954-bc36ba20b8b1%2F801c969e-671b-4163-beab-ec70ff324769%2Fodyhhc_processed.jpeg&w=3840&q=75)
Transcribed Image Text:1. The price elasticity of demand for bread
A.
is computed as the percentage change in quantity demanded of bread divided by the percentage change
in price of bread.
B. will be higher if there is a new product that is a close substitute for bread.
C. will be higher if consumers consider bread to be a necessity.
D. All of the above are correct.
E. A and B, only
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