Question

Choose the correct price-elasticity label for each pair of goods. Assume this involves demand for the total of all people currently residing in Canada, the United States, and Mexico.

Answer 1

Answer:

1. Emergency surgery is less elastic than cosmetic surgery.

2. A cheeseburger at 2:00 am at a 24 hours restaurant is less elastic than a cheeseburger at 7:00 pm at a 24 hours restaurant.

3. Monthly electricity consumption is less elastic than yearly electricity consumption.

4. The wall street journal is more elastic than wall street journal at the airport.

5. Red cars are less elastic than all cars.

Explanation:

1. Emergency surgery is a necessity and if there is necessity the demand will be inelastic.

2. At 7 pm there are more restaurant open so there will be more offer than 2 am, so if there is more offer the demand is more elastic.

3. Monthly electricity consumption is less elastic because, electricity tend to increase in long run because consumer have more time to adjust their behavior.

4. To buy wall street journal there are few places and less time in the airport than in other places to buy so demand will be less elastic.

5. If there are few substitute only red cars demand will tend to be inelastic. on the contrary, if there are more substitutes (any color car), the demand for the good will be elastic and its consumption can be replaced.