Question

Coffee is a staple in America household. Please write a synopsis of the supply and demand elasticities of coffee as pertaining to various brand, origins and consumers of the product.

Answer 1

Ans. I'll make this very simple for you. As we know that coffee is a staple in America's households and it is consumed on a daily basis. Now , coffee have become a sort of if not perfectly , a necessity for most Americans and since it's near that , Price elasticity of Demand would be very low in America , change in price of coffee would not make much change in the quantity demanded for coffee. Now , Coffee takes months to grow , Hence change in prices of coffee won't effect the supply of coffee much. Thus we can also conclude that Coffee have relatively less Elasticity of Supply. Now , elasticity maym vary with different brands and origins for eg : A particular brand is more preferred than other , coffee of a particular place is more preferred by people than other etc . These things can also effect Elasticity because Elasticity of demand for those brands or origins which is preferred , would be low . Elasticity of demand of coffee with respect to Rich people would be comparatively lower than poor , this can be the case with daily consumers and occasional consumers too.

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