
Subpart (a):
The
Subpart (a):

Explanation of Solution
Fruit is more likely to be in-elastically demanding. This is because fruit as a whole has fewer substitutes than any other item in the category of the fruits.
Concept Introduction:
Price elasticity of demand: The price elasticity of demand is the responsiveness of the quantity demanded to a change in the price measured by dividing the percentage change in the quantity demanded of a product by the percentage change in the price of the product.
Subpart (b):
The price inelasticity of demand.
Subpart (b):

Explanation of Solution
Since the people are relatively inelastic or inflexible in a short run, demand for beef over the next month is more inelastic.
Subpart (c):
The price inelasticity of demand.
Subpart (c):

Explanation of Solution
The demand for the gasoline in the entire city is more in-elastically demanding. This is because branded goods are more elastic than other categories. This implies very good substitutes for Exxon gasoline, which may be available at close distances whereas fewer substitutes may be available for the category of gasoline.
Subpart (d):
The price inelasticity of demand.
Subpart (d):

Explanation of Solution
Insulin is more a necessity good for the buyers of insulin. This implies the demand for insulin from buyers is more inelastic than the demand for vitamins for the buyers of vitamins.
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Chapter 5 Solutions
EBK MODERN PRINCIPLES OF ECONOMICS
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