Choose a product. Describe the elasticity of demand for your product. 2 marksANSWER: Identify one factor that influences the elasticity of demand for that product. 2 marksANSWER b): Discuss what happens to elasticity of demand if you vary that factor.

Answered: Choose a product. Describe the…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Choose a product. Describe the elasticity of demand for your product. 2 marks

ANSWER:

Identify one factor that influences the elasticity of demand for that product. 2 marks

ANSWER b):

Discuss what happens to elasticity of demand if you vary that factor.

Expert Solution

Step 1

Choose a product. Describe the elasticity of demand for your product.

Answer: The Apple or iPhone

The price of iPhones has little effect on demand. The tremendous level of brand loyalty that Apple has been able to develop is the reason behind this. People are unwilling to switch to other brands, even if the price of an iPhone increases. Because of how well-known the Apple brand is, many customers are willing to pay more for Apple goods. Many people will keep purchasing Apple iPhones even if the price goes up.

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