Factored Completely, M5+m3-6m Is Equivalent To 1 M - Gauthmath

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Question

Content QUESTION 45 Table 6-2 2 points Sav Refer to Table 6-2. Assume that an economist has estimated the price elasticity of demand values in the table above. Use the data in the table to select the correct statement. The elasticity for "All soft drinks" is less than the elasticity for Coca-Cola because Coca-Cola is more of a luxury than a necessity; "All soft drinks" represent goods that are more necessity than luxury. There are fewer substitutes for "All carbonated soft drinks" than there are for "All soft drinks." The demand for Coca-Cola is inelastic. The difference in elasticity values is explained by the fact that the more narrowly we define a market the more elastic the demand will be.SHOW LESS5

Solution

The elasticity for "All soft drinks" is less than the elasticity for Coca-Cola because Coca-Cola is more of a luxury than a necessity; "All soft drinks" represent goods that are more necessity than luxury.

A. The correct statement is: The elasticity for "All soft drinks" is less than the elasticity for Coca-Cola because Coca-Cola is more of a luxury than a necessity; "All soft drinks" represent goods that are more necessity than luxury.

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