Question

Other things equal, the demand for a good tends to be more inelastic, thea.

a.more narrowly defined is the market for the good.
b.fewer the available substitutes.
c.more the good is considered a luxury good.
d.longer the time period considered.

Answer 1

Option (b) is correct.

Step-by-step explanation:

The demand for a particular good is more inelastic if an increase in the price of a good doesn't or little effect on the demand for that good.

If there are fewer substitutes available for a particular good then an increase in the price of a particular good doesn't affect the demand for that good much because of the less alternatives available for the consumers.

Hence, they have to purchase this good even at a higher prices, so, the demand for that good doesn't or little change.

That's why the demand for those goods tends to be more inelastic.