Question

In general, the price elasticity of demand for a good will be ____ elastic the _____ share of the good in the average consumer's budgeta. less; smallerb. unit; largerc. less; largerd. more; smaller

Answer 1

a. less; smaller

Step-by-step explanation:

Remember that the price elasticity of demand for a good will be greater if the amount of the budget of the person buying it is larger, so they are correlational, the greater the portion of the budget the greater the pirce elasticity of demand, the same inversed, the smaller portion of the budget the lesser the price elasticity of demand.

The price elasticity of demand is a term used to exemplify the change in percentage that would happen to a products demand if the price goes up or down.

Answer 2

a. less, smaller

Step-by-step explanation:

The larger the share spent on a good, the demand of such good will be more elastic. For example, the elasticity for a car is higher (more elastic) that the demand for salt. A 1% increase in the price of salt will lead to a small (or null) cutback in salt consumption for a family, but if the price of a car increases in 1% will probably have a bigger effect in the demand for such car.