Discuss factors that influence price elasticity of demand
Microeconomics
There are four factors that influence the value elasticity of demand:
– The availability of substitutes
– The specific nature of the good
– The part of income spent on the good
– The time consumers have to buy the good
Select a product you have purchased in the past month from a clothing or shoe store.
Explain how each of the 4 factors contributed to the elasticity of the good.
Is the product considered elastic, inelastic, or unitary elastic?
What effect does the current supply and current demand have on this product?
