Homework Answers
There are various factors that impact the elasticity of demand for a good.
Factors that affect elasticity of demand are as follows -
Number of substitutes - A good that has no or fewer substitutes has inelastic demand while a good that has many substitutes has elastic demand.
Percentage of consumer's income spent on the good - A good that account for large percentage of consumer's income has elastic demand. On the other hand, a good that account for smaller percentage of consumer's income has inelastic demand.
Time period - The greater the time period for the procurement of the good, elastic would be its demand and smaller the time period for the procurement of the good, inelastic would be its demand.
Thus,
All the given reasons would result in making demand more elastic.
Hence, the correct answer is the option (4) [All of the above].
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