There are fewer substitutes for all running shoes (and they are not as good substitutes). Thus, the demand for a specific brand of running shoe should be more elastic than the demand for running shoes in general. 5.
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Are running shoes inelastic or elastic?
price inelastic
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.
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).
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.
For which product is demand likely to be the most elastic?
In general, necessities and medical treatments tend to be inelastic, while luxury goods tend to be most elastic.
Which of the following is likely to have the most price elastic demand?
Music downloads likely to have most price elastic demand.
What is the type of demand on Nike?
The demand for Nike products is price inelastic because the increase in price have little to minor changes on the quantity demanded. If a large change in price is accompanied by a small amount of change in quantity demanded, the product is inelastic.
Is Nike market demand increasing?
Nike’s digital sales through Nike’s apps and websites grew 22%, led by a 33% growth in North America, the company said.
What makes something elastic or inelastic?
A product is considered to be elastic if the quantity demand of the product changes more than proportionally when its price increases or decreases. Conversely, a product is considered to be inelastic if the quantity demand of the product changes very little when its price fluctuates.
What are the factors that affect elasticity of demand?
Key Takeaways. Many factors determine the demand elasticity for a product, including price levels, the type of product or service, income levels, and the availability of any potential substitutes. High-priced products often are highly elastic because, if prices fall, consumers are likely to buy at a lower price.
What are the factors that affect elasticity of demand and how does each affect elasticity?
The four factors that affect price elasticity of demand are (1) availability of substitutes, (2) if the good is a luxury or a necessity, (3) the proportion of income spent on the good, and (4) how much time has elapsed since the time the price changed. If income elasticity is positive, the good is normal.
Why the demand for the good or service provided by a firm is elastic or inelastic?
If the demand changes by more than the change in price or income, it has elastic demand. If demand changes by less than the change in price or income, it has inelastic demand. When demand changes by the same amount as price or income, the good or service has unit elastic demand.
Why the demand for labor for long run is more elastic compare to short run?
Second, labor demand will be more elastic in the long run than in the short run. Generally, the more time consumers have to adjust to price changes, the greater their response will be and hence the greater the elasticity of demand for the workers who produce the product.
Why is demand inelastic in the short run?
Demand tends to be more price inelastic in the short-run as consumers don’t have time to find alternatives. In the long-run, consumers become more aware of alternatives. Price elasticity of demand measures the responsiveness of demand to a change in price.
Which of the following best explains why demand is often less elastic in the short run than it is in the long run?
Which of the following best explains why demand is often more elastic in the long run than it is in the short run? d. When demand is elastic, price increases reduce revenue because a small price increase will lead to a large decrease in quantity demanded.
Which of the following is an example of an elastic demand situation?
An example of products with an elastic demand is consumer durables. These are items that are purchased infrequently, like a washing machine or an automobile, and can be postponed if price rises. For example, automobile rebates have been very successful in increasing automobile sales by reducing price.
What is elastic demand examples?
An elastic demand curve is one where the quantity demanded of a given good is sensitive to changes in price. For example, if airline tickets to Maui increased by 10% and the amount of people buying tickets dropped by more than 10%, then airline tickets to Maui would be considered to have an elastic demand.
Which category of goods has the least elastic most inelastic price elasticity of demand?
The Bottom Line
Goods that are considered essential have a low elasticity of demand. Electricity, gas, oil, and water are all relatively inelastic because consumers rely on these as necessities rather than luxuries.
When the demand for a product is perfectly elastic a price increase will result in?
Perfect elastic demand means that quantity demanded will increase to infinity when the price decreases, and quantity demanded will decrease to zero when price increases.
Which of the following types of goods has the largest positive income elasticity of demand?
The demand for jewelry tends to have highest income elasticity of demand because the individuals will only increase the demand for jewelry when their income increases.