Asked by Kylie Gravel on Jul 17, 2024
Verified
Which product will have the most elastic demand curve?
A) Gasoline
B) Heating oil
C) Shell-brand gasoline
D) Cigarettes
Elastic Demand Curve
A demand curve that indicates a high responsiveness or sensitivity of quantity demanded to a change in price.
Shell-brand Gasoline
A type of fuel sold under the Shell brand name, which is a global group of energy and petrochemical companies.
Heating Oil
A low viscosity, liquid petroleum product used as a fuel oil for furnaces or boilers in buildings.
- Elucidate the distinctions between elastic and inelastic demand.
- Discern the traits of commodities based on their demand elasticity versus inelasticity.
Verified Answer
AM
Aleksa MarquezJul 21, 2024
Final Answer :
C
Explanation :
Shell-brand gasoline will have the most elastic demand curve because it is a specific brand of a broadly available product. Consumers can easily switch to other brands if the price of Shell-brand gasoline increases, making its demand more sensitive to price changes compared to the more generic or necessity-based products listed, such as gasoline in general, heating oil, and cigarettes, which have fewer close substitutes and are more of a necessity for consumers.
Learning Objectives
- Elucidate the distinctions between elastic and inelastic demand.
- Discern the traits of commodities based on their demand elasticity versus inelasticity.