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Question 12 Which of the following would result in a higher absolute value of the price elasticity of demand for a product? T
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Answer #1

Answer : The answer is option D.

If many substitutes are available in the market for a particular good then consumers get more choice to purchase the good based on price level. This means that if many substitutes are available in the market then if the price of the good increase then consumers get more choices to purchase substitute goods. In this situation the price elasticity of demand for the good is higher. Therefore, option D is correct.

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Answer #2
the good is a necessity
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