MNG ECO Week #5/ DQ#1 For each of the following pairs of goods or services, iden

Question

MNG ECO Week #5/ DQ#1

For each of the following pairs of goods or services, identify the one

for which price elasticity of demand is greater and explain why.

- Coffee/ Starbucks Coffee

- Tuition at a public university/ tuition at a private university

- Emergency room medical service/ annual physical exam

- Movies in the afternoon/ movies at night

- Prescription medicine/ over-the-counter medicine

PLEASE ANSWER THE FOLLOWING QUESTIONS IF ALL ANSWERED CORRECTLY WILL RATE 5 STARS NO SCREEN SHOTS OR IMAGES OF RESPONSE. PLEASE TYPE YOUR ANSWER OR UPLOAD DOCUMENT IF REQUIREMENTS MENTIONED ABOVE ARE NOT MET I WILL GIVE A NEGATIVE RATING

Explanation / Answer

Price elasticity of demand is high for a luxury good and low for a necessity or basic good. A slight decrease in the price of a luxury good, will increase its demand by a large amount because people are very responsive to price changes in case of elastic demand.

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