Question

Which of the following statements is correct?

Answer 1

Answer:

D) All of the above are correct

Explanation:

In general terms, luxurious, or non-necessary items that have many substitutes are more elastic than daily necessities such as food or gasoline.

Flat-screen computer monitors are a luxury item, and a regular-screen monitor works just as well, therefore, if the price of them rises a lot, people can always buy regular monitors. The demand for this product is very elastic.

Same is true for grandfather clocks, which not only are expensive, but also niche, in the sense that they likely only appeal to a small segment of people.

As for cardboards, this product also has substitutes, and the demand for it in the long-term is more elastic because people will have more time to look for those substitutes.